Contents PAGE u List of Rules/Regulations
I-9
u List of Notifications
I-11
u List of Circulars
I-13
u List of Guidelines
I-19
u Amendments made by Insolvency and Bankruptcy Code (Amend-
I-21
ment) Act, 2021 at a glance u Amendments made by Insolvency and Bankruptcy Code (Amend-
ment) Act, 2020 and Insolvency and Bankruptcy Code (Second Amendment) Act, 2020 at a glance
I-23
u Amendments made by Insolvency and Bankruptcy Code (Amend-
I-25
ment) Act, 2019 at a glance u Guide to Insolvency and Bankruptcy Code (Amendment) Act,
I-31
2021 u Insolvency and Bankruptcy Law Guide
I-51
u A table showing enforcement of provisions of Insolvency and
I-153
Bankruptcy Code, 2016
DIVISION ONE INSOLVENCY AND BANKRUPTCY CODE, 2016 u Arrangement of Sections
1.3
u Text of Insolvency and Bankruptcy Code, 2016 as amended by
Insolvency and Bankruptcy Code (Amendment) Act, 2021
1.15
u Appendix : Provisions of other Acts referred to in Insolvency and
1.189
Bankruptcy Code u Insolvency and Bankruptcy Code (Amendment) Act, 2021
1.223
u Insolvency and Bankruptcy Code (Second Amendment) Act, 2020
1.243
u Insolvency and Bankruptcy Code (Amendment) Act, 2020
1.245
u Insolvency and Bankruptcy Code (Amendment) Act, 2019
1.251
u Subject Index
1.255
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CONTENTS
I-6 PAGE
DIVISION TWO RULES AND REGULATIONS u Insolvency and Bankruptcy Board of India (Model Bye-Laws and
Governing Board of Insolvency Professional Agencies) Regulations, 2016
2.3
u Insolvency and Bankruptcy Board of India (Insolvency Professional
Agencies) Regulations, 2016
2.20
u Insolvency and Bankruptcy Board of India (Insolvency Profession-
als) Regulations, 2016
2.32
u Insolvency and Bankruptcy (Application to Adjudicating
Authority) Rules, 2016
2.63
u Insolvency and Bankruptcy Board of India (Insolvency Resolution
Process for Corporate Persons) Regulations, 2016
2.82
u Insolvency and Bankruptcy Board of India (Liquidation Process)
Regulations, 2016
2.154
u Insolvency and Bankruptcy Board of India (Voluntary Liquida-
tion Process) Regulations, 2017
2.217
u Insolvency and Bankruptcy Board of India (Information Utilities)
Regulations, 2017
2.256
u Insolvency and Bankruptcy Board of India (Advisory Committee)
Regulations, 2017
2.288
u Insolvency and Bankruptcy Board of India (Procedure for
Governing Board Meetings) Regulations, 2017
2.291
u Insolvency and Bankruptcy Board of India (Engagement of
Research Associates and Consultants) Regulations, 2017
2.300
u Insolvency and Bankruptcy Board of India (Salary, Allowances and
Other Terms and Conditions of Service of Chairperson and Members) Rules, 2016
2.305
u Insolvency and Bankruptcy Board of India (Fast Track Insolvency
Resolution Process for Corporate Persons) Regulations, 2017
2.311
u Insolvency and Bankruptcy Board of India (Inspection and Investi-
gation) Regulations, 2017
2.350
u Insolvency and Bankruptcy Board of India (Employees’ Service)
Regulations, 2017
2.360
u Insolvency and Bankruptcy Board of India (Grievance and
Complaint Handling Procedure) Regulations, 2017
2.392
u Insolvency and Bankruptcy Board of India (Annual Report)
Rules, 2018
2.398
u Insolvency and Bankruptcy Board of India (Form of Annual
Statement of Accounts) Rules, 2018
2.400
u Insolvency and Bankruptcy Board of India (Mechanism for
Issuing Regulations) Regulations, 2018
2.419
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CONTENTS PAGE
u Companies (Registered Valuers and Valuation) Rules, 2017
2.422
u Insolvency and Bankruptcy Board of India (Medical Facility to
Chairperson and Whole-time Members) Scheme Rules, 2019
2.444
u Insolvency and Bankruptcy (Application to Adjudicating Authority
for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019
2.446
u Insolvency and Bankruptcy (Insolvency and Liquidation Proceed-
ings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019
2.465
u Insolvency and Bankruptcy (Application to Adjudicating Authority
for Bankruptcy Process for Personal Guarantors to Corporate Debtors) Rules, 2019
2.473
u Insolvency and Bankruptcy Board of India (Bankruptcy Process for
Personal Guarantors to Corporate Debtors) Regulations, 2019
2.498
u Insolvency and Bankruptcy Board of India (Insolvency Resolution
Process for Personal Guarantors to Corporate Debtors) Regulations, 2019
2.519
u Insolvency and Bankruptcy (Pre-packaged Insolvency Resolution
2.534
Process) Rules, 2021 u Insolvency and Bankruptcy Board of India (Pre-packaged Insol-
vency Resolution Process) Regulations, 2021
2.541
DIVISION THREE GUIDELINES ISSUED UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016 u Guidelines for Technical Standards for the Performance of Core
Services and Other Services under the Insolvency and Bankruptcy Board of India (Information Utilities) Regulations, 2017 u Guidelines for empanelment of advocates
3.3 3.36
u Insolvency and Bankruptcy Board of India (Online Delivery of
Educational Course and Continuing Professional Education by Insolvency Professional Agencies and Registered Valuers Organisations) Guidelines, 2020
3.46
u Insolvency and Bankruptcy Board of India (Use of Caveats, Limi-
tations and Disclaimers by the Registered Valuers in Valuation Reports) Guidelines, 2020
3.49
u Insolvency and Bankruptcy Board of India (Continuing Profes-
sional Education for Insolvency Professionals) Guidelines, 2019
3.69
u Guidelines for Appointment of Insolvency Professionals as Admi-
nistrators under the Securities and Exchange Board of India (Appointment of Administrator and Procedure for Refunding to the Investors) Regulations, 2018
3.75
CONTENTS
I-8 PAGE
u Insolvency Professionals to Act as Interim Resolution Profession-
als, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) (Second) Guidelines, 2021
3.82
DIVISION FOUR NOTIFICATIONS ISSUED UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016 u Notifications issued under Insolvency and Bankruptcy Code, 2016
4.3
DIVISION FIVE CIRCULARS ISSUED UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016 u Circulars issued under Insolvency and Bankruptcy Code, 2016
5.3
DIVISION SIX RBI (PRUDENTIAL FRAMEWORK FOR RESOLUTION OF STRESSED ASSETS) DIRECTIONS, 2019 u Reserve Bank of India (Prudential Framework for Resolution of
Stressed Assets) Directions, 2019
6.3
INSOLVENCY AND BANKRUPTCY LAW GUIDE
1 BACKGROUND OF INSOLVENCY CODE
1.1 Objective of Insolvency Code The vision of law (as given in press release of Government of India) is to encourage entrepreneurship and innovation. Some business ventures will always fail, but they will be handled rapidly and swiftly. Entrepreneurs and lenders will be able to move on, instead of being bogged down with decisions taken in the past. Insolvency Code is not a substitute for recovery forum - Wherever there is existence of real dispute, provisions of Insolvency Code cannot be invoked. Insolvency code is not intended to be substitute to recovery forum - Mobilox Innovations v. Kirusa Software (2018) 1 SCC 353 = 144 SCL 37 = 85 taxmann.com 292 (SC) - quoted with approval in Transmission Corporation of Andhra Pradesh v. Equipment Conductors (2018) 150 SCL 447 = 98 taxmann.com 375 (SC). Insolvency Code is a beneficial legislation intended to put the corporate debtor back on its feet and not a mere recovery legislation. Intention is to protect interest of corporate debtor - Babulal Vardharji Gurjar v. Veer Gurjar Aluminium Industries P. Ltd. (2020) 160 SCL 784 = 118 taxmann.com 323 = [2020] 15 SCC 1 (SC) - quoted with approval in Laxmi Pat Surana v.Union Bank of India [2021] 166 SCL 318 = 125 taxmann.com 394 (SC 3 member bench).
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INSOLVENCY AND BANKRUPTCY LAW GUIDE
1.1-1 Purpose of Insolvency and Bankruptcy Code, 2016 As per preamble to the Insolvency Code, the purpose of this Act is as follows— u
Consolidate and amend the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals
u
In a time bound manner
For maximisation of value of assets of such persons u To promote entrepreneurship u Availability of credit u Balance the interests of all the stakeholders including alteration in the order of priority of payment of Government dues u Establish an Insolvency and Bankruptcy Board of India (IBBI) Insolvency code is a complete code (and decisions in other Acts will not apply) - Insolvency code is a consolidating Act. It is complete and exhaustive in the matters dealt with therein. The Code is Parliamentary law that is exhaustive code on the subject matter of insolvency. It is covered in Entry 9 List III of Seventh Schedule, which reads as follows - Bankruptcy and Insolvency. Innoventive Industries v. ICICI Bank (2018) 1 SCC 407 = 143 SCL 625 = 84 taxmann.com 320 (SC). u
1.1-2 Overall Structure of Insolvency Code Broad structure of Insolvency Code is as follows— Chapters in each part
Section Nos.
Part I - Preliminary No separate chapter in Part I
1 to 3
Part II - Insolvency Resolution and Liquidation for Corporate Persons Chapter I - Preliminary
4 and 5
Chapter II - Corporate Insolvency Resolution Process
7 to 32A
Chapter III - Liquidation Process
33 to 54
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INSOLVENCY AND BANKRUPTCY LAW GUIDE
Chapters in each part
Section Nos.
Chapter III-A - Pre-Packaged Insolvency Resolution Process
54A to 54P
Chapter IV - Fast track corporation insolvency resolution process
55 to 58
Chapter V - Voluntary liquidation of corporate persons
59
Chapter VI - Adjudicating Authority for corporate persons
60 to 67
Chapter VII - Offences and Penalties
68 to 77A
Part III - Insolvency Resolution and Bankruptcy for Individuals and partnership firms Chapter I - Preliminary
78 to 79
Chapter II - Fast Track Process
80 to 93
Chapter III - Insolvency Resolution Process
94 to 120
Chapter IV - Bankruptcy Order for Individuals
121 to 148
Chapter V - Administration and distribution of assets of bankrupt
149 to 178
Chapter VI - Adjudicating Authority for individuals and partnership firms
179 to 183
Chapter VII - Offences and Penalties
184 to 187
Part IV - Regulation of Insolvency Professionals, Agencies and Information Utilities Chapter I - Insolvency and Bankruptcy Board of India
188 to 195
Chapter II - Powers and Functions of Board
196 to 198
Chapter III - Insolvency Professional Agencies
199 to 205
Chapter IV - Insolvency Professionals
206 to 208
Chapter V - Information Utilities
209 to 216
Chapter VI - Inspection and Investigation
217 to 220
Chapter VII - Finance, Accounts and Audit
221 to 223
INSOLVENCY AND BANKRUPTCY LAW GUIDE
Chapters in each part
I-54
Section Nos.
Part V - Miscellaneous No separate chapter in Part V
224 to 255 and Schedules 1 to 12
1.1-3 Pre-packaged insolvency resolution process (PPIRP) The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2021 was issued on 4-4-2021, making amendments to Insolvency Code. The Ordinance has been converted into Insolvency and Bankruptcy Code (Amendment) Act, 2021 on 11-8-2021. The amendments are with retrospective effect from 4-4-2021. A pre-packaged insolvency resolution process (PPIRP) for corporate persons classified as micro, small and medium enterprises (MSME) has been introduced by issuing w.e.f. 4-4-2021. Chapter III-A [sections 54A to 54P] has been introduced in Part II of Insolvency Code. The scheme of PPRIP has been discussed later.
1.1-4 Insolvency Code applies to personal guarantors of corporate debtors Insolvency Code was made applicable to personal guarantors of corporate debtors w.e.f. 23-11-2017. However, there was no specific provision to conduct insolvency resolution process or bankruptcy process if the personal guarantor does not pay up. Now, this gap has been filled up w.e.f. 1-12-2019. Provisions relating to Insolvency Resolution and Bankruptcy for individuals and partnership firms (section 78 to section 187 of Insolvency Code) have been made partially effective on 15-112019 only for personal guarantors of corporate debtors (not for other individuals and partnership firms). Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 and Insolvency and Bankruptcy (Application to Adjudicating Authority for Bankruptcy Process for Personal Guarantors to Corporate Debtors) Rules, 2019 have been made effective from 1-12-2019.
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INSOLVENCY AND BANKRUPTCY LAW GUIDE
IBBI (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019 and IBBI (Bankruptcy Process for Personal Guarantors to Corporate Debtors) Regulations, 2019 have also been notified w.e.f. 1-12-2019. NCLT will be ‘adjudicating authority’ for this purpose. NCLAT will be appellate authority. Many writ petitions were filed before various High Courts regarding applicability of provisions of Insolvency Code to personal guarantors. Hence, all writ petitions were transferred to Supreme Court in IBBI v. Lalit Kumar Jain (2020) 10 SCC 703 = 121 taxmann.com 364 = 163 SCL 291 (SC). Now, the provision of making Insolvency Code applicable to personal guarantors of corporate debtors has been held valid in Lalit Kumar Jain v. UOI [2021] 127 taxmann.com 368 (SC).
1.2 Overall scheme of the Insolvency and Bankruptcy Code An Insolvency and Bankruptcy Board of India (IBBI) will be established. This Board (IBBI) will oversee the work of insolvency and bankruptcy of corporate persons, firms and individuals. [The Board (IBBI) has been established on 1-10-2016, vide Notification No. 3110(E) dated 1-10-2016]. Actual work relating to insolvency and bankruptcy will be handled mostly by ‘Insolvency Professionals’ (IP). They will be members of ‘Insolvency Professional Agency’ (IPA) which will ensure that the members have sufficient knowledge and expertise in these matters. IPA will also regulate the profession of IP. The basic idea of Insolvency Code is that when an enterprise (individual, firm or corporation person) defaults in payment of its dues, the control shifts to Committee of Creditors (CoC) of financial creditors. Actual work is handled by IP. There are specified time limits to evaluate proposals for resuscitating (rehabilitating) the enterprise or taking it to liquidation. IP has control over the debtor under supervision of CoC. Decisions are required to be taken in a time bound manner so that there are greater chances that the enterprise is saved as a going concern and productive resources of economy can be put to best use.
Insolvency and Bankruptcy Law Manual AUTHOR PUBLISHER DATE OF PUBLICATION EDITION ISBN NO PAGE NO. BINDING TYPE
: : : : : : :
TAXMANN TAXMANN JANUARY 2022 15TH EDITION 9789393656926 1446 PAPERBACK
Rs. 1995 | USD 68
Description This book contains a compilation of amended, updated & annotated text of the Insolvency and Bankruptcy Code 2016 (IBC) [as amended by the Insolvency and Bankruptcy Code (Amendment) Act 2021]. What sets this book apart is the unique way of presenting the text of the IBC along with Relevant Rules/Regulations, Guidelines, Notifications, Circulars, RBI Directions, etc. In other words, read the Section of the IBC and get the following: u
28+ Relevant Rules/Regulations
u
7+ Relevant Guidelines issued under the IBC
u
Relevant Notifications issued under the IBC
u
Relevant Circulars issued under the IBC
u
RBI (Prudential Framework for Resolution of Stressed Assets) Directions 2019
Along with the above, the readers also get a specially curated & comprehensive Guide to Insolvency & Bankruptcy Code (Amendment) Act 2021. The Present Publication is the 15th Edition, authored by Taxmann’s Editorial Board, updated till January 2022, with the following noteworthy features: u
[Taxmann’s series of Bestseller Books] on IBC
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[Follows the six-sigma approach] to achieve the benchmark of ‘zero error.’
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[Previous Amendments] made by the following:
u
n
Insolvency and Bankruptcy Code (Amendment) Act, 2021
n
Insolvency and Bankruptcy Code (Second Amendment) Act, 2020 & Insolvency and Bankruptcy Code (Amendment) Act, 2020
n
Insolvency and Bankruptcy Code (Amendment) Act, 2019
[Tables] showing enforcement of Provisions of the IBC
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