Bloomsbury’s The Insolvency and Bankruptcy Code, 2016 with Rules and Regulations

B L O O M S B U RY ’ S

THE INSOLVENCY AND BANKRUPTCY CODE, 2016

WITH RULES AND REGULATIONS As amended by the Insolvency and Bankruptcy Code (Amendment) Act, 2018

CONTENTS AT A GLANCE THE INSOLVENCYAND BANKRUPTCY CODE -- The Insolvencyand Bankruptcy Code (Amendment) Act, 2018 . . . . . . . . . . . . . . . . 1 -- The Insolvency and Bankruptcy Code, 2016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

RULES AND REGULATIONS -- Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 . 173 -- IBBI (Salary, Allowances and other Terms and Conditions of Service of Chairperson and members) Rules, 2016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195 -- IBBI (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201 -- IBBI (Insolvency Professional Agencies) Regulations, 2016 . . . . . . . . . . . . . . . . 215 -- IBBI (Insolvency Professionals) Regulations, 2016 . . . . . . . . . . . . . . . . . . . . . . . 227 -- IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 . . 247 -- IBBI (Liquidation Process) Regulations, 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . 285 -- IBBI (Engagement of Research Associates and Consultants) Regulations, 2017. . . 333 -- IBBI (Procedure for Governing Board Meetings) Regulations, 2017. . . . . . . . . . 339 -- IBBI (Advisory Committee) Regulations, 2017. . . . . . . . . . . . . . . . . . . . . . . . . . . 349 -- IBBI (Information Utilities) Regulations, 2017. . . . . . . . . . . . . . . . . . . . . . . . . . . 353 -- IBBI (Voluntary Liquidation Process) Regulations, 2017. . . . . . . . . . . . . . . . . . . 381 -- IBBI (Inspection and Investigation) Regulations, 2017. . . . . . . . . . . . . . . . . . . . . 419 -- IBBI (Fast Track Insolvency Resolution Process for Corporate Persons) Regulations, 2017. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431 -- IBBI (Grievance and Complaint Handling Procedure) Regulations, 2017 . . . . . . 471 -- IBBI (Employees’ Service) Regulations, 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . 479 -- Companies (Transfer of Pending Proceedings) Rules, 2016. . . . . . . . . . . . . . . . . 515

NOTIFICATIONS, CIRCULARS, ORDERS, GUIDELINES AND LIST OF PRESS RELEASES Notifications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 519 Circulars. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 537 Orders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 547 Guidelines. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557 List of Press releases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 589 v

TABLE OF CONTENTS THE INSOLVENCYAND BANKRUPTCY CODE (AMENDMENT) ACT, 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.

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Amendment of section 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 3.

Amendment of section 5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 4.

Amendment of section 25. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 5.

Insertion of new section 29A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 6.

Amendment of section 30. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 7.

Amendment of section 35. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 8.

Insertion of new section 235A.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 9.

Amendment of section 240. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 10. Repeal and savings.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 THE INSOLVENCY AND BANKRUPTCY CODE, 2016. . . . . . . . . . . . . . . . . . 7

Part I Preliminary

1.

Short title, extent and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 2. Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 3.

Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Part II Insolvency Resolution and Liquidation for Corporate Persons Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 4.

Application of this Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 5.

Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Chapter II Corporate Insolvency Resolution Process. . . . . . . . . . . . . . . . . . . . . 18 6.

Persons who may initiate corporate insolvency resolution process . . . . . . . . . 18 7.

Initiation of corporate insolvency resolution process by financial creditor . . . 18 8.

Insolvency resolution by operational creditor . . . . . . . . . . . . . . . . . . . . . . . . . 19 9.

Application for initiation of corporate insolvency resolution process by operational creditor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 10. Initiation of corporate insolvency resolution process by corporate applicant . 21 11. Persons not entitled to make application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 12. Time-limit for completion of insolvency resolution process . . . . . . . . . . . . . . 22 13. Declaration of moratorium and public announcement . . . . . . . . . . . . . . . . . . . 23 14. Moratorium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 15. Public announcement of corporate insolvency resolution process . . . . . . . . . . 24 16. Appointment and tenure of interim resolution professional . . . . . . . . . . . . . . . 25 vii

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17. Management of affairs of corporate debtor by interim resolution professional .25 18. Duties of interim resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 19. Personnel to extend co-operation to interim resolution professional . . . . . . . . 27 20. Management of operations of corporate debtor as going concern . . . . . . . . . . 28 21. Committee of creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 22. Appointment of resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 23. Resolution professional to conduct corporate insolvency resolution process . 31 24. Meeting of committee of creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 25. Duties of resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 26. Application for avoidance of transactions not to affect proceedings . . . . . . . . 33 27. Replacement of resolution professional by committee of creditors . . . . . . . . . 33 28. Approval of committee of creditors for certain actions . . . . . . . . . . . . . . . . . . 33 29. Preparation of information memorandum . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 29A. Persons not eligible to be resolution applicant . . . . . . . . . . . . . . . . . . . . . . . . . 35 30. Submission of resolution plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 31. Approval of resolution plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 32. Appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Chapter III Liquidation Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 33. Initiation of liquidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 34. Appointment of liquidator and fee to be paid . . . . . . . . . . . . . . . . . . . . . . . . . . 40 35. Powers and duties of liquidator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 36. Liquidation estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 37. Powers of liquidator to access information . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 38. Consolidation of claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 39. Verification of claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 40. Admission or rejection of claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 41. Determination of valuation of claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 42. Appeal against the decision of liquidator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 43. Preferential transactions and relevant time . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 44. Orders in case of preferential transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 45. Avoidance of undervalued transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 46. Relevant period for avoidable transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 47. Application by creditor in cases of undervalued transactions . . . . . . . . . . . . . 49 48. Order in cases of undervalued transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 49. Transactions defrauding creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 50. Extortionate credit transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 51. Orders of Adjudicating Authority in respect of extortionate credit transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 52. Secured creditor in liquidation proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 53. Distribution of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 54. Dissolution of corporate debtor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 Chapter IV Fast Track Corporate Insolvency Resolution Process . . . . . . . . . . . 55 55. Fast track corporation insolvency resolution process . . . . . . . . . . . . . . . . . . . . 55 viii

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Time period for completion of fast track corporate insolvency resolution process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Manner of initiating fast track corporate insolvency resolution process. . . . . . 56 Applicability of Chapter II to this Chapter . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

Chapter V Voluntary Liquidation of Corporate Persons . . . . . . . . . . . . . . . . . . 56 59. Voluntary liquidation of corporate persons . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Chapter VI Adjudicating Authority for Corporate Persons. . . . . . . . . . . . . . . . . 58 60. Adjudicating Authority for corporate persons . . . . . . . . . . . . . . . . . . . . . . . . . 58 61. Appeals and Appellate Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 62. Appeal to Supreme Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 63. Civil court not to have jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 64. Expeditious disposal of applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 65. Fraudulent or malicious initiation of proceedings . . . . . . . . . . . . . . . . . . . . . . 61 66. Fraudulent trading or wrongful trading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 67. Proceedings under section 66 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Chapter VII Offences and Penalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 68. Punishment for concealment of property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 69. Punishment for transactions defrauding creditors . . . . . . . . . . . . . . . . . . . . . . 63 70. Punishment for misconduct in course of corporate insolvency resolution process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 71. Punishment for falsification of books of corporate debtor . . . . . . . . . . . . . . . . 65 72. Punishment for wilful and material omissions from statements relating to affairs of corporate debtor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 73. Punishment for false representations to creditors . . . . . . . . . . . . . . . . . . . . . . . 65 74. Punishment for contravention of moratorium or the resolution plan . . . . . . . . 66 75. Punishment for false information furnished in application . . . . . . . . . . . . . . . 66 76. Punishment for non- disclosure of dispute or repayment of debt by operational creditor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 77. Punishment for providing false information in application made by corporate debtor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

Part III Insolvency Resolution and Bankruptcy for Individuals and Partnership Firms Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 78. Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 79. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 Chapter II Fresh Start Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 80. Eligibility for making an application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 81. Application for fresh start order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 ix

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Appointment of resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 Examination of application by resolution professional. . . . . . . . . . . . . . . . . . . 73 Admission or rejection of application by Adjudicating Authority . . . . . . . . . . 74 Effect of admission of application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 Objections by creditor and their examination by resolution professional. . . . . 75 Application against decision of resolution professional. . . . . . . . . . . . . . . . . . 76 General duties of debtor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Replacement of resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Directions for compliances of restrictions, etc . . . . . . . . . . . . . . . . . . . . . . . . . 77 Revocation of order admitting application . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 Discharge order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 Standard of conduct. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

Chapter III Insolvency Resolution Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 94. Application by debtor to initiate insolvency resolution process. . . . . . . . . . . . 78 95. Application by creditor to initiate insolvency resolution process. . . . . . . . . . . 79 96. Interim-moratorium. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 97. Appointment of resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 98. Replacement of resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 99. Submission of report by resolution professional. . . . . . . . . . . . . . . . . . . . . . . . 82 100. Admission or rejection of application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 101. Moratorium. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 102. Public notice and claims from creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 103. Registering of claims by creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 104. Preparation of list of creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 105. Repayment plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 106. Report of resolution professional on repayment plan. . . . . . . . . . . . . . . . . . . . 85 107. Summoning of meeting of creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 108. Conduct of meeting of creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 109. Voting rights in meeting of creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87 110. Rights of secured creditors in relation to repayment plan. . . . . . . . . . . . . . . . . 87 111. Approval of repayment plan by creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 112. Report of meeting of creditors on repayment plan . . . . . . . . . . . . . . . . . . . . . . 88 113. Notice of decisions taken at meeting of creditors. . . . . . . . . . . . . . . . . . . . . . . 88 114. Order of Adjudicating Authority on repayment plan. . . . . . . . . . . . . . . . . . . . . 88 115. Effect of order of Adjudicating Authority on repayment plan. . . . . . . . . . . . . . 89 116. Implementation and supervision of repayment plan. . . . . . . . . . . . . . . . . . . . . 89 117. Completion of repayment plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89 118. Repayment plan coming to end prematurely. . . . . . . . . . . . . . . . . . . . . . . . . . . 89 119. Discharge order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90 120. Standard of conduct. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90 Chapter IV Bankruptcy Order for Individuals and Partnership Firms . . . . . . 91 121. Application for bankruptcy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 122. Application by debtor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 x

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Application by creditor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 Effect of application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92 Appointment of insolvency professional as bankruptcy trustee. . . . . . . . . . . . 93 Bankruptcy order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93 Validity of bankruptcy order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94 Effect of bankruptcy order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94 Statement of financial position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94 Public notice inviting claims from creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Registration of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Preparation of list of creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Summoning of meeting of creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96 Conduct of meeting of creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96 Voting rights of creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96 Administration and distribution of estate of bankrupt. . . . . . . . . . . . . . . . . . . . 97 Completion of administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 Discharge order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 Effect of discharge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 Disqualification of bankrupt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 Restrictions on bankrupt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 Modification or recall of bankruptcy order. . . . . . . . . . . . . . . . . . . . . . . . . . . . 99 Standard of conduct. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 Fees of bankruptcy trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 Replacement of bankruptcy trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 Resignation by bankruptcy trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101 Vacancy in office of bankruptcy trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101 Release of bankruptcy trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102

Chapter V Administration and Distribution of the Estate of the Bankrupt. . 103 149. Functions of bankruptcy trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103 150. Duties of bankrupt towards bankruptcy trustee. . . . . . . . . . . . . . . . . . . . . . . . 103 151. Rights of bankruptcy trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103 152. General powers of bankruptcy trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104 153. Approval of creditors for certain acts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104 154. Vesting of estate of bankrupt in bankruptcy trustee . . . . . . . . . . . . . . . . . . . . 105 155. Estate of bankrupt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 156. Delivery of property and documents to bankruptcy trustee . . . . . . . . . . . . . . 106 157. Acquisition of control by bankruptcy trustee . . . . . . . . . . . . . . . . . . . . . . . . . 106 158. Restrictions on disposition of property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 159. After-acquired property of bankrupt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 160. Onerous property of bankrupt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 161. Notice to disclaim onerous property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108 162. Disclaimer of leaseholds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108 163. Challenge against disclaimed property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108 164. Undervalued transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109 165. Preference transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 xi

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166.

167.

168.

169.

170.

171.

172.

173.

174.

175.

176.

177.

178.

Effect of order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Extortionate credit transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Obligations under contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 Continuance of proceedings on death of bankrupt . . . . . . . . . . . . . . . . . . . . . 113 Administration of estate of deceased bankrupt. . . . . . . . . . . . . . . . . . . . . . . . 113 Proof of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 Proof of debt by secured creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Mutual credit and set-off. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Distribution of interim dividend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Distribution of property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115 Final dividend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115 Claims of creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116 Priority of payment of debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117

Chapter VI Adjudicating Authority for Individuals and Partnership Firms. . 118 179. Adjudicating Authority for individuals and partnership firms. . . . . . . . . . . . . 118 180. Civil court not to have jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118 181. Appeal to Debt Recovery Appellate Tribunal. . . . . . . . . . . . . . . . . . . . . . . . . 119 182. Appeal to Supreme Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 183. Expeditious disposal of applications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Chapter VII Offences and Penalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 184. Punishment for false information, etc., by creditor in insolvency resolution process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 185. Punishment for contravention of provisions. . . . . . . . . . . . . . . . . . . . . . . . . . 120 186. Punishment for false information, concealment, etc., by bankrupt. . . . . . . . . 120 187. Punishment for certain actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121

Part IV Regulation of Insolvency Professionals, Agencies and Information Utilities Chapter I The Insolvency and Bankruptcy Board of India. . . . . . . . . . . . . . . 122 188. Establishment and incorporation of Board . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 189. Constitution of Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 190. Removal of member from office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123 191. Powers of Chairperson . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 192. Meetings of Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 193. Member not to participate in meetings in certain cases . . . . . . . . . . . . . . . . . 124 194. Vacancies, etc., not to invalidate proceedings of Board, Officers and employees of Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 195. Power to designate financial sector regulator . . . . . . . . . . . . . . . . . . . . . . . . . 125

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Chapter II Powers and Functions of the Board. . . . . . . . . . . . . . . . . . . . . . . . . 125 196. Powers and functions of Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125 197. Constitution of advisory committee, executive committee or other committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128 198. Condonation of delay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128 Chapter III Insolvency Professional Agencies. . . . . . . . . . . . . . . . . . . . . . . . . . . 128 199. No person to function as insolvency professional agency without valid certificate of registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128 200. Principles governing registration of insolvency professional agency . . . . . . 128 201. Registration of insolvency professional agency . . . . . . . . . . . . . . . . . . . . . . . 129 202. Appeal to National Company Law Appellate Tribunal . . . . . . . . . . . . . . . . . 130 203. Governing Board of insolvency professional agency . . . . . . . . . . . . . . . . . . . 130 204. Functions of insolvency professional agencies . . . . . . . . . . . . . . . . . . . . . . . 130 205. Insolvency professional agencies to make bye-laws . . . . . . . . . . . . . . . . . . . 131 Chapter IV Insolvency Professionals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131 206. Enrolled and registered persons to act as insolvency professionals . . . . . . . . 131 207. Registration of insolvency professionals . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131 208. Functions and obligations of insolvency professionals . . . . . . . . . . . . . . . . . 132 Chapter V Information Utilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132 209. No person to function as information utility without certificate of registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132 210. Registration of information utility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133 211. Appeal to National Company Law Appellate Tribunal . . . . . . . . . . . . . . . . . 133 212. Governing Board of information utility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134 213. Core services, etc., of information utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 134 214. Obligations of information utility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134 215. Procedure for submission, etc., of financial information . . . . . . . . . . . . . . . . 134 216. Rights and obligations of persons submitting financial information. . . . . . . . 135 Chapter VI Inspection and Investigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135 217. Complaints against insolvency professional agency or its member or information utility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135 218. Investigation of insolvency professional agency or its member or information utility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135 219. Show cause notice to insolvency professional agency or its member or information utility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 220. Appointment of disciplinary committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 Chapter VII Finance, Accounts and Audit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 221. Grants by Central Government . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 222. Board’s Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 223. Accounts and audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 xiii

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224. Insolvency and Bankruptcy Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140 225. Power of Central Government to issue directions . . . . . . . . . . . . . . . . . . . . . 140 226. Power of Central Government to supersede Board . . . . . . . . . . . . . . . . . . . . 141 227. Power of Central Government to notify financial service providers, etc.. . . . 142 228. Budget. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 229. Annual report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 230. Delegation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 231. Bar of jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 232. Members, officers and employees of Board to the public servants . . . . . . . . 143 233. Protection of action taken in good faith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 234. Agreements with foreign countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 235. Letter of request to a country outside India in certain cases . . . . . . . . . . . . . 143 235A. Punishment where no specific penalty or punishment is provided. . . . . . . . . 144 236. Trial of offences by Special Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144 237. Appeal and revision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144 238. Provisions of this Code to override other laws . . . . . . . . . . . . . . . . . . . . . . . . 145 239. Power to make rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145 240. Power to make regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 241. Rules and regulations to be laid before Parliament . . . . . . . . . . . . . . . . . . . . 152 242. Power to remove difficulties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153 243. Repeal of certain enactments and savings. . . . . . . . . . . . . . . . . . . . . . . . . . . . 153 244. Transitional provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154 245. Amendments of Act 9 of 1932. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 246. Amendments of Act 1 of 1944 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 247. Amendments of Act 43 of 1961 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 248. Amendments of Act 52 of 1962 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 249. Amendments of Act 51 of 1993. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 250. Amendments of Act 32 of 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 251. Amendments of Act 54 of 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 252. Amendments of Act 1 of 2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156 253. Amendments of Act 51 of 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156 254. Amendments of Act 6 of 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156 255. Amendment of Act 18 of 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156 The First Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157 The Second Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157 The Third Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157 The Fourth Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157 The Fifth Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158 The Sixth Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159 The Seventh Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159 The Eighth Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160 xiv

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The Ninth Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 The Tenth Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 The Eleventh Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 INSOLVENCY AND BANKRUPTCY (APPLICATION TO ADJUDICATING AUTHORITY) RULES, 2016. . . . . . . . . . . . . . . . . . . . . . . . 173 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173 2. Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173 3.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173 4.

Application by financial creditor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 174 5.

Demand notice by operational creditor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 174 6.

Application by operational creditor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 174 7.

Application by corporate applicant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 8.

Withdrawal of application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 9.

Interim resolution professional. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 10. Filing of application and application fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 Form 1 Application by Financial Creditor(s) to Initiate Corporate Insolvency Resolution Process under the Code. . . . . . . . . . . . . . . . . . . . . 177 Form 2 Written Communication by Proposed Interim Resolution Professional . . 180 Form 3 Form of Demand Notice/Invoice Demanding Payment under the Insolvency and Bankruptcy Code, 2016 . . . . . . . . . . . . . . . . . . 182 Form 4 Form of Notice with which Invoice Demanding Payment is to be Attached. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184 Form 5 Application by Operational Creditor to Initiate Corporate Insolvency Resolution Process under the Code. . . . . . . . . . . . . . . . . . . . . 185 Form 6 Application by Corporate Applicant to Initiate Corporate Insolvency Resolution Process under the Code. . . . . . . . . . . . . . . . . . . . . 189 Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193 IBBI (SALARY, ALLOWANCES AND OTHER TERMS AND CONDITIONS OF SERVICE OF CHAIRPERSON AND MEMBERS) RULES, 2016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195 3.

Terms and conditions of service of Chairperson and members. . . . . . . . . . . . 195 4. Pay. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196 5.

Dearness Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196 6.

Entertainment Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196 7. Leave. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196 8.

Leave Sanctioning Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 9.

Provident Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 10. Travelling Allowance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 11. Leave Travel Concession. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 198 xv

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12. Accommodation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 198 13. Conveyance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 198 14. Bonus. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199 15. Sitting Fees and Board’s Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199 16. Encashment of Leave. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199 17. Facilities for medical treatment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199 18. Residuary Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199 19. Terms and Conditions of Services of Part-time Members. . . . . . . . . . . . . . . . 199 20. Fee and Allowances of Part-time Members. . . . . . . . . . . . . . . . . . . . . . . . . . . 199 21. Power to Relax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200 IBBI (MODEL BYE-LAWS AND GOVERNING BOARD OF INSOLVENCY PROFESSIONAL AGENCIES) REGULATIONS, 2016. . . 201 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201 Chapter II Bye Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202 3.

Insolvency professional agencies to have Bye-Laws . . . . . . . . . . . . . . . . . . . 202 4.

Amendment of Bye-Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202 Chapter III Governing Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202 5.

Composition of the Governing Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202 Schedule Model Bye-Laws of an Insolvency Professional Agency. . . . . . . . . . . . . . 204 Annexure Form A Certificate of Professional Membership. . . . . . . . . . . . . . . . . . . 214 IBBI (INSOLVENCY PROFESSIONAL AGENCIES) REGULATIONS, 2016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 Chapter II Registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216 3.

Eligibility for registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216 4.

Application for registration or renewal thereof. . . . . . . . . . . . . . . . . . . . . . . . 216 5.

Grant of certificate of registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217 6.

Procedure for rejecting application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 218 Chapter III Surrender or Cancellation of Registration. . . . . . . . . . . . . . . . . . . . 218 Surrender of registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 218 7.

8.

Disciplinary proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 219 9. Appeal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 221

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Chapter IV In-Principle Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 221 10. Grant of in-principle approval. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 221 Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 222 Form A Application for Certificate of Registration . . . . . . . . . . . . . . . . . . . . . . . . 222 Form B The Insolvency and Bankruptcy Board of India. . . . . . . . . . . . . . . . . . . . . 226 IBBI (INSOLVENCY PROFESSIONALS) REGULATIONS, 2016 . . . . . . . 227 Chapter I General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227 Chapter II Insolvency Examinations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228 3. […] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228 Chapter III Registration of Insolvency Professionals. . . . . . . . . . . . . . . . . . . . . 228 4. Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228 5.

Qualifications and experience. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 229 6.

Application for certificate of registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 229 7.

Certificate of registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230 8.

Refusal to grant certificate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230 9.

Registration for a limited period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231 Chapter IV Temporary Surrender and Disciplinary Proceedings. . . . . . . . . . . 232 10. Temporary surrender. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 232 11. Disciplinary proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 232 Chapter V Recognition of Insolvency Professional Entities. . . . . . . . . . . . . . . 233 12. […]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233 13. […]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 234 14. […]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 234 First Schedule: Code of Conduct for Insolvency Professionals. . . . . . . . . . . . . . . . . 235 Second Schedule: Code of Conduct for Insolvency Professionals. . . . . . . . . . . . . . . 242 Form A Application for Registration as an Insolvency Professional/Insolvency Professional for Limited Period. . . . . . . . . . . . . 238 Form B Insolvency and Bankruptcy Board of India Certificate of Registration. . . 242 Form C Application for Recognition as an Insolvency Professional Entity. . . . . . 243 Form D Insolvency and Bankruptcy Board of India Certificate of Recognition. . . 245 IBBI (INSOLVENCY RESOLUTION PROCESS FOR CORPORATE PERSONS) REGULATIONS, 2016 . . . . . . . . . . . . . . . . . . . . . 247 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247 xvii

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Chapter II General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 249 3.

Eligibility for resolution professional. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 249 4.

Access to books. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250 5.

Extortionate credit transaction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250 Chapter III Public Announcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250 6.

Public announcement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250 Chapter IV Proof of Claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251 7.

Claims by operational creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251 8.

Claims by financial creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251 9.

Claims by workmen and employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 252 9A. Claims by other creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 252 10. Substantiation of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 11. Cost of proof. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 12. Submission of proof of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 13. Verification of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 14. Determination of amount of claim. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 254 15. Debt in foreign currency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 254 Chapter V Committee of Creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 254 16. Committee with only operational creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . 254 17. First meeting of the committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 255 18. Meetings of the committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 255 Chapter VI Meetings of the Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 255 19. Notice for meetings of the committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 255 20. Service of notice by electronic means. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 256 21. Contents of the notice for meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 256 22. Quorum at the meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 257 23. Participation through video conferencing. . . . . . . . . . . . . . . . . . . . . . . . . . . . 258 24. Conduct of meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 258 Chapter VII Voting by the Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259 25. Voting by the committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259 26. Voting through electronic means. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260 Chapter VIII Conduct of Corporate Insolvency Resolution Process. . . . . . . . . . 261 27. Appointment of registered valuers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 261 28. Transfer of debt due to creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 261 29. Sale of assets outside the ordinary course of business . . . . . . . . . . . . . . . . . . 261 30. Assistance of local district administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . 262 Chapter IX Insolvency Resolution Process Costs . . . . . . . . . . . . . . . . . . . . . . . . 262 31. Insolvency resolution process costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 262 32. Essential supplies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 262 xviii

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33.

34.

Costs of the interim resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . 262 Resolution professional costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 263

Chapter X Resolution Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 263 35. Liquidation value. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 263 36. Information memorandum. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264 37. Resolution plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 38. Mandatory contents of the resolution plan . . . . . . . . . . . . . . . . . . . . . . . . . . . 266 39. Approval of resolution plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 268 40. Extension of the corporate insolvency resolution process period. . . . . . . . . . 269 Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270 Form A Public Announcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270 Form B Proof of Claim by Operational Creditors Except Workmen and Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271 Form C Proof of Claim by Financial Creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . 274 Form D Proof of Claim by A Workman or an Employee. . . . . . . . . . . . . . . . . . . . . 276 Form E Proof of Claim Submitted by Authorised Representative of Workmen and Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 279 IBBI (LIQUIDATION PROCESS) REGULATIONS, 2016. . . . . . . . . . . . . . . 285 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285 Chapter II Appointment and Remuneration of Liquidator . . . . . . . . . . . . . . . 286 3.

Eligibility for appointment as liquidator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286 4.

Liquidator’s fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 287 Chapter III Powers and Functions of Liquidator . . . . . . . . . . . . . . . . . . . . . . . . 288 5. Reporting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 288 6.

Registers and books of account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 289 7.

Appointment of professionals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 290 8.

Consultation with stakeholders.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 290 9.

Personnel to extend cooperation to liquidator. . . . . . . . . . . . . . . . . . . . . . . . . 290 10. Disclaimer of onerous property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 291 11. Extortionate credit transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 Chapter IV General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 12. Public announcement by liquidator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 13. Preliminary report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 14. Early dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293 15. Progress reports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293

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Chapter V Claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 295 16. Proof of claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 295 17. Claims by operational creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 295 18. Claims by financial creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296 19. Claims by workmen and employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296 20. Claims by other stakeholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 297 21. Proving security interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 298 22. Production of bills of exchange and promissory notes. . . . . . . . . . . . . . . . . . 298 23. Substantiation of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 298 24. Cost of proof. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 298 25. Determination of quantum of claim. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 298 26. Debt in foreign currency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 298 27. Periodical payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299 28. Debt payable at future time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299 29. Mutual credits and set-off. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299 30. Verification of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299 31. List of stakeholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300 Chapter VI Realisation of Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300 32. Manner of sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300 33. Mode of sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 301 34. Asset memorandum. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 301 35. Valuation of assets intended to be sold. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 302 36. Asset sale report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 302 37. Realization of security interest by secured creditor. . . . . . . . . . . . . . . . . . . . . 303 38. Distribution of unsold assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 303 39. Recovery of monies due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 304 40. Liquidator to realize uncalled capital or unpaid capital contribution. . . . . . . 304 Chapter VII Proceeds of Liquidation and Distribution of Proceeds. . . . . . . . . . 304 41. All money to be paid in to bank account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 304 42. Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305 43. Return of money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305 44. Completion of liquidation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305 45. Final report prior to dissolution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 305 46. Unclaimed proceeds of liquidation or undistributed assets. . . . . . . . . . . . . . . 306 Schedule I Mode of Sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307 Schedule II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309 Form A Proforma for Reporting Consultations with Stakeholders. . . . . . . . . . . . . 309 Form B Public Announcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309 Form C Proof of Claim by Operational Creditors except Workmen and Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 311 Form D Proof of Claim by Financial Creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . 314 Form E Proof of Claim by a Workman or Employee . . . . . . . . . . . . . . . . . . . . . . . 317 Form F Proof of Claim by Authorised Representative of Workmen or Employees. 319 xx

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Form G Proof of Claim by Any Other Stakeholder. . . . . . . . . . . . . . . . . . . . . . . . . 322 Schedule III Formats of registers and books to be maintained under regulation 6(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325 IBBI (ENGAGEMENT OF RESEARCH ASSOCIATES AND CONSULTANTS) REGULATIONS, 2017. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333 3.

Research Associates and Consultants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333 4.

Functions of Research Associates and Consultants. . . . . . . . . . . . . . . . . . . . . 334 5.

Qualifications, experience and remuneration . . . . . . . . . . . . . . . . . . . . . . . . . 334 6.

Evaluation of performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334 7.

Selection of Research Associates and Consultants. . . . . . . . . . . . . . . . . . . . . 334 8.

Terms and condition of engagement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335 9.

Power to relax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 336 Schedule I Eligibility for Research Associates and Consultants for different disciplines. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337 Schedule II Levels for Research Associates and Consultant. . . . . . . . . . . . . . . . . . . 338 IBBI (PROCEDURE FOR GOVERNING BOARD MEETINGS) REGULATIONS, 2017. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339 1.

Short title and commencement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339 Chapter II Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340 3.

Governing Board Businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340 Chapter III Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341 4.

Convening of Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341 5. Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341 6. Quorum. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341 7.

Leave of absence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 342 8.

Minutes of the meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 342 9. Secretary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 342 Chapter IV Charter of Conduct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 342 10.

Member not to participate in meetings in certain cases . . . . . . . . . . . . . . . . 342 Obligation of a Member to give information of disqualification . . . . . . . . . 343 11.

12.

Declaration of fidelity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 343 Chapter V Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 343 13.

Manner and form in which contracts may be executed. . . . . . . . . . . . . . . . . 343 14.

Affixation of Common Seal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 343 xxi

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Chapter VI Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 344 15.

Power to regulate procedure in certain circumstances . . . . . . . . . . . . . . . . . 344 16.

Effect of any irregularity of procedure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 344 17.

Meetings of Committees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 344 18. Relaxation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 344 Schedule I Oath of Office and Secrecy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 345 Schedule II Charter of Conduct for Members of Board . . . . . . . . . . . . . . . . . . . . . . 345 IBBI (ADVISORY COMMITTEE) REGULATIONS, 2017. . . . . . . . . . . . . . 349 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349 Chapter II Constitution of Advisory Committee . . . . . . . . . . . . . . . . . . . . . . . . 350 3.

Constitution of Advisory Committee.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 350 4.

Composition of Advisory Committee.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 350 Chapter III Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351 5. Meetings.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351 6. Fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351 7. Conduct. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 351 IBBI (INFORMATION UTILITIES) REGULATIONS, 2017 . . . . . . . . . . . . 353 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353 Chapter II Registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 354 3.

Eligibility for registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 354 4.

Application for registration or renewal thereof. . . . . . . . . . . . . . . . . . . . . . . . 355 5.

Disposal of application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 356 6.

Conditions of registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 357 7.

In-principle approval. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358 Chapter III Shareholding and Governance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358 8. Shareholding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358 9.

Composition of the Governing Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 359 10. Regulatory Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 360 11. Compliance officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 360 12. Grievance Redressal Policy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 360

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Chapter IV Technical Standards and Bye-Laws. . . . . . . . . . . . . . . . . . . . . . . . . 361 13. Technical Standards. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 361 14. Technical Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362 15. Bye-laws of information utilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362 16. Amendment to bye-laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362 Chapter V Core Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363 17. Provision of services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363 18. Registration of users . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363 19. Use of different information utilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364 20. Acceptance and receipt of information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364 21. Information of default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364 22. Storage of information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 365 23. Access to information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 365 24. Accessing information stored with other information utilities. . . . . . . . . . . . 365 25. Annual statement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 365 26. Porting information from registries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366 27. Duties of the user. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366 Chapter VI Duties of Information Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366 28. General duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366 29. Non-discrimination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366 30. Other duties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366 31. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367 32. Fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367 33. Risk management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367 34. Audit of information technology framework. . . . . . . . . . . . . . . . . . . . . . . . . . 368 35. Preservation Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 368 36. Provision of information to the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 368 37. Inspection. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369 Chapter VII Services to Insolvency Professionals. . . . . . . . . . . . . . . . . . . . . . . . . 369 38. Storing information submitted by insolvency professionals. . . . . . . . . . . . . . 369 Chapter VIII Surrender or Cancellation of Registration. . . . . . . . . . . . . . . . . . . . 369 39. Exit management plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369 40. Surrender of registration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369 41. Disciplinary proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 370 42. Appeal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 371 Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 372 Form A Application for Certificate of Registration . . . . . . . . . . . . . . . . . . . . . . . . 372 Form B The Insolvency and Bankruptcy Board of India certificate of Registration No._. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376 Form C Format of information under regulation 20. . . . . . . . . . . . . . . . . . . . . . . . 377

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IBBI (VOLUNTARY LIQUIDATION PROCESS) REGULATIONS, 2017. 381 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381 Chapter II Commencement of Liquidation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 382 3.

Initiation of Liquidation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 382 4.

Effect of liquidation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 383 Chapter III Appointment and Remuneration of Liquidator . . . . . . . . . . . . . . . 383 5.

Appointment of Liquidator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 383 6.

Eligibility for appointment as liquidator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 384 7.

Liquidator’s remuneration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 384 Chapter IV Powers and Functions of the Liquidator. . . . . . . . . . . . . . . . . . . . . 384 8. Reporting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 384 9.

Preliminary Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 385 10. Registers and books of account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 385 11. Engagement of professionals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386 12. Consultation with stakeholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386 13. Extortionate credit transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 14. Public announcement by the liquidator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 15. Proof of claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 Chapter V Claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 16. Claims by operational creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 17. Claims by financial creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 388 18. Claims by workmen and employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 388 19. Claims by other stakeholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389 20. Proving security interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389 21. Production of bills of exchange and promissory notes. . . . . . . . . . . . . . . . . . 390 22. Substantiation of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390 23. Cost of proof. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390 24. Determination of quantum of claim. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390 25. Debt in foreign currency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390 26. Periodical payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390 27. Debt payable at future time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390 28. Mutual credits and set-off. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 391 29. Verification of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 391 30. List of stakeholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 391 Chapter VI Realisation of Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 392 31. Manner of sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 392 32. Recovery of monies due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 392 33. Liquidator to realize uncalled capital or unpaid capital contribution. . . . . . . 392 xxiv

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Chapter VII Proceeds of Liquidation and Distribution of Proceeds. . . . . . . . . . 393 34. All money to be paid in to bank account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393 35. Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393 36. Return of money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393 37. Completion of liquidation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393 38. Final Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394 39. Unclaimed proceeds of liquidation or undistributed assets. . . . . . . . . . . . . . . 395 40. Detection of Fraud or Insolvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 395 41. Preservation of records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 396 Schedule I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 397 Form A Public Announcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 397 Form B Proof of Claim by Operational Creditors except Workmen and Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 398 Form C Proof of Claim by Financial Creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . 400 Form D Proof of Claim by a Workman or Employee . . . . . . . . . . . . . . . . . . . . . . . 403 Form E Proof of Claim by Authorised Representative of Workmen or Employees. 405 Form F Proof of Claim by any other Stakeholder. . . . . . . . . . . . . . . . . . . . . . . . . . 407 Schedule II Format of registers and books to be maintained under regulation 10(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410 IBBI (INSPECTION AND INVESTIGATION) REGULATIONS, 2017. . . . 419 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 419 1.

Short title, commencement and application . . . . . . . . . . . . . . . . . . . . . . . . . . 419 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 419 Chapter II Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 420 3.

Inspection by the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 420 4.

Conduct of Inspection. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 421 Interim Inspection Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 422 5.

6.

Inspection Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 422 Chapter III Investigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423 7.

Investigation by the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423 8.

Conduct of Investigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423 9.

Interim Investigation Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 425 10. Investigation Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 425 Chapter IV Consideration of Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426 11. Consideration of Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426 12. Show-cause notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426 13. Disposal of Show-cause notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 427 Chapter V Restitution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 428 14. Restitution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 428 Form A Format of submission of claims under regulation 14(3). . . . . . . . . . . . . . 429 xxv

Insolvency and Bankruptcy Code, 2016 with Rules and Regulations

IBBI(FAST TRACK INSOLVENCY RESOLUTION PROCESS FOR CORPORATE PERSONS) REGULATIONS, 2017. . . . . . . . . . . . . . . . . 431 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431 1.

Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431 Chapter II General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 433 3.

Eligibility for resolution professional. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 433 4.

Access to books. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 434 5.

Extortionate credit transaction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 434 Chapter III Public Announcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 434 6.

Public announcement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 434 Chapter IV Proof of Claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435 7.

Claims by operational creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435 8.

Claims by financial creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435 9.

Claims by workmen and employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 436 9A. Claims by other creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437 10. Substantiation of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437 11. Cost of proof proving the debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437 12. Submission of proof of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437 13. Verification of claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 438 14. Determination of amount of claim. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 438 15. Debt in foreign currency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 438 Chapter V Committee of Creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 438 16. Committee with only operational creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . 438 17. Filings by the interim resolution professional. . . . . . . . . . . . . . . . . . . . . . . . . 439 Chapter VI Meetings of the Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440 18. Meetings of the committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440 19. Notice for meetings of the committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440 20. Service of notice by electronic means. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440 21. Contents of the notice for meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 441 22. Quorum at the meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 441 23. Participation through video conferencing. . . . . . . . . . . . . . . . . . . . . . . . . . . . 442 24. Conduct of meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443 Chapter VII Voting by the Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443 25. Voting by the committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443 Chapter VIII Conduct of the Fast Track Process. . . . . . . . . . . . . . . . . . . . . . . . . . 445 26. Appointment of registered valuer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445 27. Transfer of debt due to creditors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445 xxvi

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28.

29.

Sale of assets outside the ordinary course of business . . . . . . . . . . . . . . . . . . 445 Assistance of local district administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . 446

Chapter IX Fast Track Process Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 446 30. Fast track process costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 446 31. Essential supplies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 446 32. Costs of the interim resolution professional . . . . . . . . . . . . . . . . . . . . . . . . . . 447 33. Resolution professional costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 447 Chapter X Resolution Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 447 34. Liquidation value. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 447 35. Information memorandum. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448 36. Resolution plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 449 37. Mandatory contents of the resolution plan . . . . . . . . . . . . . . . . . . . . . . . . . . . 450 38. Approval of resolution plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 452 39. Extension of the fast track process period. . . . . . . . . . . . . . . . . . . . . . . . . . . . 453 Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 454 Form A Public Announcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 454 Form B Proof of Claim by Operational Creditors except Workmen and Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455 Form C Proof of Claim by Financial Creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . 459 Form D Proof of Claim by a Workman or an Employee. . . . . . . . . . . . . . . . . . . . . 461 Form E Proof of Claim Submitted by Authorised Representative of Workmen and Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 464 IBBI (GRIEVANCE AND COMPLAINT HANDLING PROCEDURE) REGULATIONS, 2017. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471 1.

Short title, commencement and application.. . . . . . . . . . . . . . . . . . . . . . . . . . 471 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471 Chapter II Filing of Grievance and Complaint . . . . . . . . . . . . . . . . . . . . . . . . . 472 3.

Filing of grievance and complaint. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 472 4.

Identity of the stakeholder. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 473 5.

Registration number.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 473 Chapter III Disposal of Grievance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474 6.

Disposal of grievance.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474 Chapter IV Disposal of Complaint. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474 7.

Disposal of complaint.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474 Chapter V Statistics. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 475 8.

The Board shall periodically disclose summary statistics about receipt and disposal of grievances and complaints on its web site.. . . . 475 Form A Format of filing complaint under regulation 3(3). . . . . . . . . . . . . . . . . . . 475 xxvii

Insolvency and Bankruptcy Code, 2016 with Rules and Regulations

IBBI (EMPLOYEES’ SERVICE) REGULATIONS, 2017. . . . . . . . . . . . . . . . 479 Chapter I Preliminary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 479 1.

Short title and commencement.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 479 2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 479 Chapter II Appointment, Probation and Termination of Service. . . . . . . . . . . 480 Classification and appointment of employees. . . . . . . . . . . . . . . . . . . . . . . . . 480 3.

4. Recruitment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481 5.

Initial Appointments to be made on minimum pay.. . . . . . . . . . . . . . . . . . . . . 481 6. Probation.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481 7.

Commencement of service.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481 8.

Resignation from service. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481 9.

Superannuation and retirement.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 482 10. Liquidated damages.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 483 Chapter III Record of Service, Seniority and Promotion. . . . . . . . . . . . . . . . . . 483 11. Record of service. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 483 12. Seniority.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 483 13. Promotion.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 483 Chapter IV Pay, Allowances and other Beneffits. . . . . . . . . . . . . . . . . . . . . . . . . 483 14. Entitlement.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 483 15. Pay, allowances and other benefits.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484 16. Gratuity.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484 17. Pension.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484 18. Cessation of pay and allowances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484 19. Increments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 20. Fixation of pay on promotion.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 21. Hometown. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 Chapter V Leave and Joining Time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 22. Leave not a matter of right.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 23. Kinds of leave.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 24. Lapse of leave on cessation of service.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486 25. Obligation to furnish Leave address.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486 26. Leave not admissible to an employee under suspension. . . . . . . . . . . . . . . . . 486 27. Casual leave.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486 28. Special casual leave. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 487 29. Ordinary leave. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 487 30. Sick leave.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 488 31. Maternity leave and paternity leave.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489 32. Accident leave. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489 33. Extraordinary leave.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489 34. Joining time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 490 xxviii

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Chapter VI Conduct, Discipline and Appeals . . . . . . . . . . . . . . . . . . . . . . . . . . . 490 35. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 490 36. Scope of an employee’s service.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 490 37. Liability to abide by regulations and directions.. . . . . . . . . . . . . . . . . . . . . . . 491 38. Obligation to maintain secrecy.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491 39. Employees to promote Board’s interest.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491 40. Prohibition against participation in politics and standing for election.. . . . . . 493 41. Prohibition against joining certain associations and strikes.. . . . . . . . . . . . . . 493 42. Contributions to the press.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 493 43. Employee not to seek outside employment. . . . . . . . . . . . . . . . . . . . . . . . . . . 493 44. Employment after retirement.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 493 45. Employment with a service provider. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 494 46. Giving evidence.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 494 47. Acceptance of gifts.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 494 48. Movable, immovable and valuable property. . . . . . . . . . . . . . . . . . . . . . . . . . 495 49. Conviction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495 50. Prohibition of sexual harassment of women employee at work place.. . . . . . 495 51. Penalties.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496 52. Procedure for imposing major penalties.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498 53. Action on the inquiry report.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502 54. Procedure for imposing minor penalties.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502 55. Communication of orders.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503 56. Common proceedings.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503 57. Special procedure in certain cases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503 58. Suspension. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503 59. Subsistence allowance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504 60. Vigilance cases.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 505 61. Appeal.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506 Chapter VII Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506 62. Deputation of employees to other services.. . . . . . . . . . . . . . . . . . . . . . . . . . . 506 63. Redressal of grievances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 507 Schedule I Method of recruitment to and eligibility for various Grades and Positions under regulation 4. . . . . . . . . . . . . . . . . . . . . . . . 508 Schedule II Process to be followed to decide retirement of an employee under regulation 9(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 512 COMPANIES (TRANSFER OF PENDING PROCEEDINGS) RULES, 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 515 Short title and commencement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 515 1.

2.

Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 515 3.

Transfer of pending proceedings relating to cases other than Winding up. . . 515 4.

Pending proceeding relating to voluntary winding up. . . . . . . . . . . . . . . . . . . 516 5.

Transfer of pending proceedings of Winding up on the ground of inability to pay debts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 516 xxix

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6.

Transfer of pending proceedings of Winding up matters on the grounds other than inability to pay debts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 517 Transfer of Records. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 517 Fees not to be paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 517

7.

8.

NOTIFICATIONS, CIRCULARS, ORDERS, GUIDELINES AND LIST OF PRESS RELEASES

Notifications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 519 Circulars. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 537 Orders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 547 Guidelines. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557 List of Press releases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 589

xxx

The Insolvencyand Bankruptcy Code (Amendment) Act, 20181 NO. 8 OF 2018

[18th January, 2018.]

New Delhi, the 19th January, 2018/Pausha 29, 1939 (Saka) An Act to amend the Insolvency and Bankruptcy Code, 2016.

BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as follows:— 1.

(1)

Short title and commencement This Act may be called the Insolvency and Bankruptcy Code (Amendment) Act, 2018.

(2)

It shall be deemed to have come into force on the 23rd day of November, 2017.

2.

Amendment of section 2 In the Insolvency and Bankruptcy Code, 2016 (31 of 2016) (hereinafter referred to as the principal Act), in section 2,— (i) in clause (d), the word “and” shall be omitted; (ii) for clause (e), the following clauses shall be substituted, namely:— “(e) personal guarantors to corporate debtors; (f) partnership firms and proprietorship firms; and (g) individuals, other than persons referred to in clause (e),”.

3.

Amendment of section 5 In section 5 of the principal Act,— (a) for clause (25), the following clause shall be substituted, namely:— ‘(25) “resolution applicant” means a person, who individually or jointly with any other person, submits a resolution plan to the resolution professional pursuant to the invitation made under clause (h) of sub-section (2) of section 25;’; 1

w.e.f. 23-11-2017, vide Gazette of India, Extraordinary, Part II—Section 1, No. 8, dtd. 19-01- 2018, by the Ministry of Law and Justice (Legislative Department).

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Insolvency and Bankruptcy Code, 2016 with Rules and Regulations

(b)

in clause (26), for the words “any person”, the words “resolution applicant” shall be substituted.

4.

Amendment of section 25 In section 25 of the principal Act, in sub-section (2), for clause (h), the following clause shall be substituted, namely:— “(h) invite prospective resolution applicants, who fulfil such criteria as may be laid down by him with the approval of committee of creditors, having regard to the complexity and scale of operations of the business of the corporate debtor and such other conditions as may be specified by the Board, to submit a resolution plan or plans.”.

5.

Insertion of new section 29A After section 29 of the principal Act, the following section shall be inserted, namely:— “29A. Persons not eligible to be resolution applicant.

A person shall not be eligible to submit a resolution plan, if such person, or any other person acting jointly or in concert with such person— (a) is an undischarged insolvent; (b) is a wilful defaulter in accordance with the guidelines of the Reserve Bank of India issued under the Banking Regulation Act, 1949 (10 of 1949); (c) has an account, or an account of a corporate debtor under the management or control of such person or of whom such person is a promoter, classified as non-performing asset in accordance with the guidelines of the Reserve Bank of India issued under the Banking Regulation Act, 1949 (10 of 1949) and at least a period of one year has lapsed from the date of such classification till the date of commencement of the corporate insolvency resolution process of the corporate debtor: Provided that the person shall be eligible to submit a resolution plan if such person makes payment of all overdue amounts with interest thereon and charges relating to non-performing asset accounts before submission of resolution plan; (d) has been convicted for any offence punishable with imprisonment for two years or more; (e) is disqualified to act as a director under the Companies Act, 2013 (18 of 2013); (f) is prohibited by the Securities and Exchange Board of India from trading in securities or accessing the securities markets; 2

The Insolvencyand Bankruptcy Code (Amendment) Act, 2018

(g)

(h)

(i) (j)

has been a promoter or in the management or control of a corporate debtor in which a preferential transaction, undervalued transaction, extortionate credit transaction or fraudulent transaction has taken place and in respect of which an order has been made by the Adjudicating Authority under this Code; has executed an enforceable guarantee in favour of a creditor in respect of a corporate debtor against which an application for insolvency resolution made by such creditor has been admitted under this Code; has been subject to any disability, corresponding to clauses (a) to (h), under any law in a jurisdiction outside India; or has a connected person not eligible under clauses (a) to (i).

Explanation.— For the purposes of this clause, the expression “connected person” means— (i) any person who is the promoter or in the management or control of the resolution applicant; or (ii) any person who shall be the promoter or in management or control of the business of the corporate debtor during the implementation of the resolution plan; or (iii) the holding company, subsidiary company, associate company or related party of a person referred to in clauses (i) and (ii): Provided that nothing in clause (iii) of this Explanation shall apply to— (A) a scheduled bank; or (B) an asset reconstruction company registered with the Reserve Bank of India under section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002); or (C) an Alternate Investment Fund registered with the Securities and Exchange Board of India.”.

6.

Amendment of section 30 In section 30 of the principal Act, for sub-section (4), the following sub-section shall be substituted, namely:— “(4)

The committee of creditors may approve a resolution plan by a vote of not less than seventy-five per cent. of voting share of the financial creditors, after considering its feasibility and viability, and such other requirements as may be specified by the Board:

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Insolvency and Bankruptcy Code, 2016 with Rules and Regulations

Provided that the committee of creditors shall not approve a resolution plan, submitted before the commencement of the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2017 (Ord. 7 of 2017), where the resolution applicant is ineligible under section 29A and may require the resolution professional to invite a fresh resolution plan where no other resolution plan is available with it: Provided further that where the resolution applicant referred to in the first proviso is ineligible under clause (c) of section 29A, the resolution applicant shall be allowed by the committee of creditors such period, not exceeding thirty days, to make payment of overdue amounts in accordance with the proviso to clause (c) of section 29A: Provided also that nothing in the second proviso shall be construed as extension of period for the purposes of the proviso to sub-section (3) of section 12, and the corporate insolvency resolution process shall be completed within the period specified in that sub-section.”.

7.

Amendment of section 35 In section 35 of the principal Act, in sub-section (1), in clause (f), the following proviso shall be inserted, namely:— “Provided that the liquidator shall not sell the immovable and movable property or actionable claims of the corporate debtor in liquidation to any person who is not eligible to be a resolution applicant.”.

8.

Insertion of new section 235A. After section 235 of the principal Act, the following section shall be inserted, namely:— “235A. Punishment where no specific penalty or punishment is provided If any person contravenes any of the provisions of this Code or the rules or regulations made thereunder for which no penalty or punishment is provided in this Code, such person shall be punishable with fine which shall not be less than one lakh rupees but which may extend to two crore rupees.”.

9.

Amendment of section 240 In section 240 of the principal Act, in sub-section (2),— (i)

after clause (s), the following clause shall be inserted, namely:— “(sa) other conditions under clause (h) of sub-secton (2) of section 25;”;

(ii)

after clause (w), the following clause shall be inserted, namely:— “(wa) other requirements under sub-section (4) of section 30;”.

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The Insolvencyand Bankruptcy Code (Amendment) Act, 2018

10.

(1)

Repeal and savings.

The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2017 (Ord. 7 of 2017) is hereby repealed.

(2)

Notwithstanding such repeal, anything done or any action taken under the Insolvency and Bankruptcy Code, 2016 (31 of 2016), as amended by the said Ordinance, shall be deemed to have been done or taken under the corresponding provisions of the said Code, as amended by this Act.

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Insolvency and Bankruptcy Code, 2016 with Rules and Regulations

6