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The Insolvency and Bankruptcy Board of India has issued the Notification on Insolvency and Bankruptcy Board of India. These Regulations shall come into force on 29th November, 2016.

Purpose

At present, there are multiple overlapping laws and adjudicating forums dealing with financial failure and insolvency of companies and individuals in India. The current legal and institutional framework does not aid lenders in effective and timely recovery or restructuring of defaulted assets and causes undue strain on the Indian credit system. Recognising that reforms in the bankruptcy and insolvency regime the Government introduced the Insolvency and Bankruptcy Code, 2016.

This step opens a new opportunities of practice for professionals in the areas of Corporate and Individual Insolvency, Corporate Liquidation Process.  

Who can be eligible?

An Individual who

  1. Is a resident of India
  2. Have prescribed qualification as provided under the regulations
  3. Is of sound mind
  4. Should be a fit and proper person
  5. Is not a minor
  6. Is not an undischarged insolvent or has not applied to be adjudicated as an insolvent
  7. Have not convicted any offence with imprisonment and others as prescribed under the regulations

Qualifications and Experience required getting registration

According to these regulations an Individual shall be eligible for registration as an insolvency professional, if he –

1. has passed the National Insolvency Examination;

2. has passed the Limited Insolvency Examination, and has fifteen years of experience in management, after he received a Bachelor’s degree from a university established or recognized by law; or

3. has passed the Limited Insolvency Examination and has ten years of experience as –

  • A chartered accountant enrolled as a member of the Institute of Chartered Accountants of India
  • A company secretary enrolled as a member of the Institute of Company Secretaries of India,
  • A cost accountant enrolled as a member of the Institute of Cost Accountants of India, or
  • An advocate enrolled with a Bar Council.

How can a person apply?

An individual enrolled with an insolvency professional agency as a professional member may make an application to the Board in Form A of the Second Schedule to these Regulations, along with a non-refundable application fee of ten thousand rupees to the Board.

If the Board is satisfied, after such inspection or inquiry as it deems necessary that the applicant is eligible under these Regulations, it may grant a certificate of registration to the applicant to carry on the activities of an insolvency professional in Form B of the Second Schedule to these Regulations, within sixty days of receipt of the application, excluding the time given by the Board for presenting additional documents, information or clarification, or appearing in person, as the case may be.

Disclaimer: This is an effort by Lexcomply.com to contribute towards improving compliance management regime. User is advised not to construe this service as legal opinion and is advisable to take a view of subject experts. 


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