IBBI’s Grievance Handling Regulations to keep a check on service providers

Vallari Dubey

resolution@vinodkothari.com

 

The Insolvency and Bankruptcy Board of India (“IBBI”) has notified a new set of regulations, named the Insolvency and Bankruptcy Board of India (Grievance and Complaint Handling Procedure) Regulations, 2017 (“Grievance Handling Regulations”) vide Gazette Notification dated 6th December, 2017, effective from 7th December, 2017[1][2].

The Regulations shall seek to protect the interests of stakeholders by getting their redressals addressed against any alleged contravention and /or suffering caused to them on an alleged conduct of service providers. There are eight Regulations, divided into 5 Chapters.

 

 

 

Grievance v. Complaint

The Regulations make a clear distinction between ‘grievance’ and ‘complaint’. Both are defined separately (refer definitions later) and the process of filing and disposal is different.

A grievance, as defined is filed by a stakeholder, called an aggrieved, when any suffering is caused to him/her/it due to a wrongful conduct of a service provider. On the other hand, a complaint is specifically filed by a stakeholder, called a complainant, when there is a contravention/breach alleged against a service provider. A complaint may or may not include a grievance.

Filing of Grievance

Regulation 3 of the Regulations provides the process of filing of grievance and complaint both.

In case of grievance, it shall contain following details as provided under Regulation 3(2):

Filing of Complaint

A complaint shall be filed as per Regulation 3(3) containing details as may be prescribed in Form A. The Form has to be accompanied along with a fee of Rs. 2,500[3]. Form A contains all the details as provided under Regulation 3(2), with following differences:

  1. Name and identity of the authorized representative of the complainant, if any;
  2. Details of the alleged contravention of any provision of the Code or rules, regulations, or guidelines made thereunder or circulars or directions issued by the Board by a service provider or its associated persons;
  3. Details of alleged conduct or activity of the service provider or its associated persons, along with date and place of such conduct or activity, which contravenes the provision of the law;
  4. Details of evidence in support of alleged contravention;
  5. Does the complainant have a grievance? If so, how it may be redressed?;
  6. Details of fees paid;
  7. Option of complainant to keep its identity confidential;
  8. List of documents attached to the Form.

Submission

The grievance and complaint, as the case may be, shall be submitted online on the website of IBBI. However, till such arrangement is facilitated, it can be submitted either through e-mail or by post/hand delivery.

Confidential Identity

A stakeholder (aggrieved or complainant, as the case may be), may request the IBBI to keep its identity confidential. IBBI may allow the same unless, it disclosure is required to process the grievance/complaint or as required by law.

Registration Number

Each grievance and compliant shall be allotted a unique registration number, which shall be communicated to the aggrieved or complainant, as the case may be, within a week of its receipt.

In case more than one grievance/complaint is received in relation to single matter, such grievances/complaints shall be clubbed together for the purpose of disposal.

Disposal of Grievance/Complaint

Grievance

IBBI shall seek information from aggrieved person or service provider, if required and shall thereon dispose of the grievance within 45 days of its receipt.

The Regulations however, do not provide for the cases where the Service Provider does not redress the grievance or ignore the direction of IBBI as above. In such cases, there is a chance that the grievance of the aggrieved remains unattended and his/its interest prejudiced.

Complaint

Alike grievance, a complaint shall also be disposed of within a period of 45 days of its receipt.

 

 

Statistics

IBBI shall disclose on its website, summary statistics of the grievances and/or complaints received and disposed of, periodically.

Conclusion

In absence of any specific regulation in this regard, protection of interest of stakeholders would not be managed properly by the IBBI. Due to such Regulations, it will now on be possible to keep a check on misconduct of any fraudulent service providers, having malafide intent or those that have supposedly breached any provisions of law, which may be prejudicial to the interest of a stakeholder(s).

Interestingly, the Regulations do not provide for marking any copy of the grievance or complaint to the service provider, against whom the same is being/has been filed while it is being filed with IBBI. Furthermore, confidentiality of identity of the aggrieved/complainant has been provided for. Seemingly, the Regulations are favoured towards an aggrieved party and stricter towards a defaulter. Adequate protection may however, will be needed for innocent service providers.

Relevant Definitions (Regulation 2)

  1. aggrieved” means a stakeholder who has filed a grievance with the Board on failing to get his grievance redressed from the concerned service provider;
  2. associated person” means a proprietor, partner, director, officer, or an employee of a service provider, a professional or a valuer engaged by a service provider or any other person acting for or on behalf of a service provider;
  3. complaint” means a written expression by a stakeholder alleging contravention of any provision of the Code or rules, regulations, or guidelines made thereunder or circulars or directions issued by the Board by a service provider or any of its associated persons and includes a complaint-cum-grievance;
  4. complaint-cum-grievance” means a complaint and grievance in the same matter.
  5. complainant” means a stakeholder who has filed a complaint or a complaint-cum-grievance with the Board;
  6. grievance” means a written expression by a stakeholder of his suffering on account of conduct of a service provider or its associated persons;
  7. service provider” means an insolvency professional agency, an insolvency professional, an insolvency professional entity or an information utility;
  8. stakeholder” means a debtor, a creditor, a claimant, a service provider, a resolution applicant and any other person having an interest in the insolvency, liquidation, voluntary liquidation, or bankruptcy transaction under the Code.

 

 

[1] http://ibbi.gov.in/webadmin/pdf/whatsnew/2017/Dec/180723_2017-12-09%2009:58:17.pdf

[2] http://ibbi.gov.in/webadmin/pdf/whatsnew/2017/Dec/press%20release-Complaint%20handling_2017-12-09%2012:16:40.pdf

[3] Fees is refundable in case of genuine complaints

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *