 "IBBI forms panel of 787 professionals to expedite resolution process")
The Insolvency and Bankruptcy Board of India (IBBI) has taken a decisive step towards expediting insolvency resolution by finalising a provisional list of 787 insolvency professionals (IPs), an increase from the previous 400 IPs listed in June, according to a report by The Economic Times (ET). This list, along with 31 insolvency professional entities (IPEs), will be presented to the adjudicating authority, which should help facilitate immediate appointments for overseeing resolution or liquidation cases.
IPs play pivotal roles as resolution professionals, liquidators, or bankruptcy trustees within the insolvency ecosystem. This initiative aims to mitigate administrative delays in appointing IPs, therefore accelerating insolvency resolution processes and protecting the value of stressed assets, as stated by a senior official in the ET report.
This move also addresses the need for the regulator to recommend an IP's name only after receiving a reference from the National Company Law Tribunal (NCLT) during a corporate insolvency resolution process (CIRP).
In June, the IBBI had prepared a common panel of 400 IPs, marking the first instance of such a consolidated list. The professionals featured in these lists were eligible for appointments as interim resolution professionals (IRPs), resolution professionals (RPs), liquidators, and bankruptcy trustees under different sections of the Insolvency and Bankruptcy Code (IBC). The list was also submitted to the Debt Recovery Tribunal for handling individual insolvency cases. The IBBI, at the time, shared its plans to renew the list periodically.
According to IBBI data, Delhi has the highest number of IPs at 176, followed by Maharashtra (143), West Bengal (79), Tamil Nadu (63), Telangana (59), Gujarat (52), and Uttar Pradesh (35).
IBBI data also revealed that, as of September 2023, 67 per cent of insolvency cases undergoing the resolution process exceeded the 270-day timeframe. An additional 13 per cent surpassed 180 days but remained under 270 days. The average time taken for resolving the 611 bankruptcy cases until December 2022 was 482 days, excluding the time taken by the NCLT.
Since IBC was adopted in late 2016 till September 2023, creditors have managed to recover Rs 3.16 trillion, equivalent to 31.85 per cent of their admitted claims from the resolution of 808 cases. The cumulative proceeds were 86.31 per cent of the fair value of the companies (at the time of IBC invocation) and 168.5 per cent of their liquidation value, according to IBBI data.