STATUTORY UPDATES

Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Amendment) Regulations, 2022

  • The Insolvency and Bankruptcy Board of India (IBBI) in exercise of powers conferred under Section 196 read with Section 240 of the Insolvency and Bankruptcy Code, 2016 introduced the following amendments to the IBBI (Insolvency Resolution Process of Corporate Person) Regulations, 2016 (CIRP Regulations):

    • Under Regulation 18 (Meeting of Committee) of the CIRP Regulations, in addition to the existing Regulation pertaining to convening a meeting of the Committee of Creditors (CoC) on the occasion when either the Resolution Professional (RP) finds it necessary or upon the request of the members of the CoC having at least 30% voting rights, the RP has been given the power by way of the present Amendment to place a proposal received from members of the committee in a meeting, if he considers it necessary. In addition to this, the RP shall also place the proposal if the same is made by members of the committee representing at least 33% of the voting
    • In terms of Regulation 39A of the CIRP Regulations, the RP or the Interim Resolution Professional (IRP) was bound to maintain the electronic and physical records relating to Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor; however, the existing Regulations did not provide any time period for maintaining those records for any particular period of time. In order to provide clarity regarding the documents that hold utmost priority, the time period for which such records shall be maintained, the amendment substituted the existing Regulation 39A with the following:

      1. The IRP or RP, as the case may be, shall preserve copies of all such records which are required to give a complete account of the CIRP
      2. Without prejudice to the generality of the obligations under sub-Regulation (1), the IRP or RP, as the case may be, shall preserve copies of records relating to or forming the basis of:

        • His appointment as IRP or RP, including the terms of appointment
        • Handing over/taking over of the assignment
        • Admission of Corporate Debtor into the CIRP
        • Public announcement
        • Constitution of committee and meetings of the committee
        • Claims, verification of claims, and list of creditors
        • Engagement of professionals, registered valuers, and insolvency professional entity, including work done, reports , submitted by them
        • Information memorandum
        • All filings with the Adjudicating Authority, Appellate Authority and their orders
        • Invitation, consideration and approval of the Resolution Plan
        • Statutory filings with Board and insolvency professional agencies
        • Correspondence during the CIRP
        • Insolvency resolution process cost
        • Preferential, undervalued, extortionate credit transactions or fraudulent or wrongful trading
      3. From the date of completion of the CIRP or the conclusion of any proceeding relating to the CIRP before the Board, the Adjudicating Authority, Appellate Authority or any Court, whichever is later, the IRP or RP shall preserve:

        • Electronic copy of all records (physical and electronic) for a minimum period of eight years
        • A physical copy of records for a minimum period of three years

      4. The IRP or RP shall preserve the records at a secure place and shall be obliged to produce records as may be required under the IBC and the Regulations

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