Recent amendments in IBBI Regulations
– Team Resolution | resolution@vinodkothari.com
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Summary of Important Supreme Court Judgements on IBC
Team Resolution | resolution@vinodkothari.com
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Open in new tab CIRP (Second Amendment Regulations), 2023 – A snapshot
– Team Resolution | resolution@vinodkothari.com
The Insolvency and Bankruptcy Board of India (IBBI), has, vide notification dated 18th September, 2023 introduced the IBBI (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2023 (‘CIRP Amendment Regulations’/ ‘Amendment Regulations’) effective from 18th September, 2023, so as to further streamline the insolvency resolution process.
The amendments (discussed below) provide some relaxation to the stakeholders thereby extending the timeline for submitting claims. Further, an attempt has also been made to provide assistance to NCLT Benches for dealing with applications u/s 7 or 9 for admission/rejection of claim. However, the obligation of the Resolution professionals (RPs) have also been increased as the amendment now requires the RPs to not just take handover of the assets of the Corporate Debtor (CD) but also verify asset by asset list of the CD, tally the same with the financials of the CD, and to report the same while making application u/s 19(2), if not found in conformity with the assets shown in the financials of the CD. Also, for condonation of delay of claims filed by the stakeholders, the amendment now requires the RP to file application before AA.
Read more →Security Interest: Meaning, forms, registration, enforcement, and effects of non-registration
-Team Vinod Kothari and Company | resolution@vinodkothari.com
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Comments on the MCA Discussion Paper on changes being considered to IBC, 2016
– Team Resolution, Vinod Kothari and Company | resolution@vinodkothari.com
The Ministry of Corporate Affairs (‘MCA’) issued a Discussion Paper on 18th January, 2023 on changes being considered to the Insolvency and Bankruptcy Code, 2016 (‘Discussion Paper’). Since the very inception of the Insolvency and Bankruptcy Code, 2016 (‘IBC’), it has undergone six amendments besides, several amendments in the respective regulations. However, the proposals in this Discussion Paper seem to be the most comprehensive one – covering all major aspects of the law.
Broadly speaking, the amendments proposed in the Discussion Paper can be categorized as follows:
- Proposals that try to overcome past difficulties:
- Voting in CoCs, direct dissolution, etc
- Enhancing the scope of pre-packs and fast track insolvency
- Proposals that codify amendments in regulations already done or IBBI circulars:
- Mandatory filing of information of default with IU
- Presumption of relinquishment of security interest
- Proposals to override or respond to some court rulings:
- Vidarbha Industries Power Limited v. Axis Bank Limited
- State Tax Officer v. Rainbow Papers Limited
- Gujarat Urja Vikas Nigam Limited v. Amit Gupta & Ors
- Fundamental or progressive amendments:
- Partial resolution
- Collapsing the levels in the waterfall
- Separation of resolution and distribution
- Resurrection of entity from liquidation to resolution
- Aggregation of assets of guarantors
- Collaboration for the purpose of group insolvency
National financial information repository: One more or one for all?
– Lovish Jain, Executive | lovish@vinodkothari.com
Some days ago, Mr. Vinod Kothari had commented on a LinkedIn post :
“Do we realise how many places does a lender (NBFC, Bank) register information about a loan? There are 4 credit information companies (such as CIBIL) where the credit data, including performance history, is uploaded. If the exposure is Rs 5 crores or above, in the aggregate over the banking system, information goes on CRILC too.
RBI has recently written to NBFCs reminding them of the obligation to register details with NeSL, an information utility under IBC, irrespective of whether the provisions of Code apply (for example in case of individuals), or whether the lender in question is at all contemplating resorting to IBC as a remedy (for example, consumer loans).
If the loan is a secured loan, the details need to be filed with CERSAI. If the secured loan borrower is a company, details need to be filed with RoC too. If the security interest is on immovable property, one needs to file particulars with land registry. If the security interest is on motor vehicles, the hypothecation is registered with Vahan portal too.
Read more →Analysing Current Issues in Liquidation under IBC & Future Reforms
– Sikha Bansal & Barsha Dikshit, Partner | resolution@vinodkothari.com
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Regulatory developments in Insolvency and bankruptcy law in 2022 – a quick round-up
– Sikha Bansal, Partner & Barsha Dikshit, Partner | resolution@vinodkothari.com
IBC, in a very short span of its life, has undergone multifarious amendments. In 2022, there were no amendments in the Code, but almost all regulations were amended. Majority of the amendments aimed at compressing the timelines. Few other amendments filled the gaps in law and provided clarity.
A quick snapshot of the key changes introduced in the CIRP regulations, Liquidation regulations, voluntary liquidation regulations and IP regulations, in the year 2022 is provided below. A brief discussion can also be referred to in our video on the same.
Key Amendments in IBBI (Insolvency Resolution Process For Corporate Persons) Regulations, 2016[1]
IBBI introduced several changes in the IRPCP Regulations vide Notifications dated 9th February, 2022, 14th June, 2022, 13th September, 2022, 16th September, 2022, and 20th September, 2022. The amendments mostly focused on reducing the timeline of corporate insolvency resolution process, removing ambiguities, facilitating IPs thereby increasing value and realisation for stakeholders.
Resolution Professionals have been empowered to invite EOI for resolution plans for one or more assets of CD with approval of CoC, if no resolution plan for CD is received within the given timeline. Resolution plan shall also provide for the manner of pursuing avoidance transaction application and distribution of realisation therefrom, if any. Timelines for certain activities during CIRP have been reduced.
Further, the regulations now also provide for payment of a regulatory fee at the rate of 0.25% of the realisable value under approved resolution plan to the Board w.e.f 1st October, 2022 which will form part of CIRP cost.
Read more →CERSAI beyond SARFAESI – The multi-faceted effects of security interest registration
– Sikha Bansal and Anirudh Grover | finserv@vinodkothari.com
Introduction
The rights of secured creditors are spread across various laws: common law, Companies Act, Insolvency and Bankruptcy Code (IBC) and the SARFAESI Act. In equal measure, the preconditions which are requisite to assert these rights are also spread over those very laws.
It is lamentable that the security interest registration regime in India is fragmented, without any obvious sense of purpose or direction. This was discussed in our previous article Fragmented Framework for Perfection of Security Interest[1].
Read more →Voluntary Liquidation under IBC
– Team Resolution | resolution@vinodkothari.com
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