IBC Updates !! Tuesday!! 06.01.2020
·
Insolvency and Bankruptcy Code (IBC) Amendments:
I.
IBBI
amends the IBBI (Liquidation Process) Regulations, 2016:
The
Insolvency and Bankruptcy Board of India amends the Insolvency and Bankruptcy Board
of India (Liquidation Process) Regulations, 2016 vide Press Release No.
IBBI/PR/2020/01 dated 06th
January, 2020.
The
Insolvency and Bankruptcy Board of India (IBBI) notified the Insolvency and
Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations, 2020.
Applicability:
w.e.f. 06.01.2020.
1. a person, who is not eligible
under the Code to submit a resolution plan for insolvency resolution of the
corporate debtor, shall not be a party in any manner to a compromise or
arrangement of the corporate debtor under section 230 of the Companies Act,
2013.
2. a secured creditor cannot sell
or transfer an asset, which is subject to security interest, to any person, who
is not eligible under the Code to submit a resolution plan for insolvency
resolution of the corporate debtor.
3. a secured creditor, who
proceeds to realise its security interest, shall contribute its share of the
insolvency resolution process cost, liquidation process cost and workmen’s
dues, within 90 days of the liquidation commencement date. It shall also pay
excess of realised value of the asset, which is subject to security interest,
over the amount of its claims admitted, within 180 days of the liquidation
commencement date. Where the secured creditor fails to pay such amounts to the
Liquidator within 90 days or 180 days, as the case may be, the asset shall
become part of Liquidation Estate.
3.
4. A Liquidator shall deposit the
amount of unclaimed dividends, if any, and undistributed proceeds, if any, in a
liquidation process along with any income earned thereon into the Corporate
Liquidation Account before he submits an application for dissolution of the
corporate debtor.
5. a process for a stakeholder to
seek withdrawal from the Corporate Liquidation Account.
Link
of the Notifications:
II.
Insolvency
and Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations,
2020:
Insolvency
and Bankruptcy Board of India hereby makes the Insolvency and Bankruptcy Board
of India (Liquidation Process) (Amendment)
Regulations,
2020, further to amend the Insolvency and Bankruptcy Board of India
(Liquidation Process) Regulations, 2016 vide Circular No. IBBI/2019-20/GN/REG053
dated 06th January, 2020.
Applicability:
They
shall come into force on the date of their publication in the Official Gazette.
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