On May 14, 2019, the Insolvency and Bankruptcy Board of India (“IBBI”) issued the Insolvency Professionals to act as Interim Resolution Professionals and Liquidators (Recommendation) Guidelines, 2019 (“Guidelines”) to facilitate recommendation of an insolvency professional (“IP”) who may act as an interim resolution professional (“IRP”) under section 16 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) where the operational creditor has not proposed an IRP, or as a liquidator pursuant to section 34 of the IBC by the IBBI.
The Guidelines state that when a reference is received by the IBBI for recommending/ proposing the name of an IP to the adjudicating authority (“AA”), the IBBI has no information about the volume, nature and complexity of the corporate insolvency resolution process (“CIRP”) or the liquidation process, and is thus unlikely to add value to the same and the process of recommending an IP is time consuming. Further, the Guidelines state that every IP is equally qualified to be appointed as the IRP/ liquidator of any CIRP/ liquidation, if otherwise not disqualified.
Therefore, the Guidelines provide that the IBBI shall prepare a common panel of IPs for appointment as IRPs and liquidators and share the same with AA. The AA may pick any name from the panel for appointment of IRP or liquidator, as the case may be, for a CIRP or liquidation process, respectively. The panel will have Bench wise list of IPs based on the registered office of the IP. Accordingly, the Guidelines contain provisions for the eligibility criteria for being on the panel, as well as the process for formation of the panel.
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