Appointment Process of the Insolvency Resolution Professional (IRP)
The appointment of an Insolvency Resolution Professional (IRP) is a critical first step in the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016 (IBC). The IRP acts as an interim administrator, taking control of the corporate debtor's affairs to preserve its value and facilitate the resolution process.
Initiation of CIRP and the Role of the Adjudicating Authority
CIRP can be initiated by a Financial Creditor, an Operational Creditor, or the Corporate Debtor itself. Upon receiving an application, the Adjudicating Authority (typically the National Company Law Tribunal - NCLT) examines it for completeness and validity. If the application is admitted, the Adjudicating Authority passes an order for the commencement of CIRP.
Criteria for IRP Appointment
The IBC and IBBI Regulations lay down specific criteria for individuals to be appointed as IRPs. These ensure that the appointed professional is competent, independent, and has the necessary qualifications to manage the complex process of corporate insolvency.
| Criteria | Requirement |
|---|---|
| Registration | Must be registered with the IBBI as an insolvency professional. |
| Independence | Must not have any conflict of interest with the corporate debtor or its stakeholders. |
| Competence | Possess the necessary qualifications, experience, and integrity. |
| Disqualification | Not be disqualified under any provisions of the IBC or other laws. |
The IRP's Role Post-Appointment
Once appointed, the IRP assumes significant responsibilities. Their primary objective is to take control and custody of the corporate debtor's assets, manage its operations, and facilitate the formation of a Committee of Creditors (CoC).
The IRP is an interim figure, tasked with stabilizing the company and initiating the creditor engagement process. Their role is temporary, lasting until the Committee of Creditors appoints a Resolution Professional (RP).
Key Steps in the Appointment Process
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Challenges and Considerations
While the process is structured, challenges can arise. These may include delays in appointment, disputes over the suitability of the IRP, or issues related to the availability of qualified professionals. The IBBI plays a crucial role in maintaining a robust registry of insolvency professionals and addressing such concerns.
Learning Resources
The primary legal document governing corporate insolvency in India. Essential for understanding the foundational provisions related to IRP appointment.
The official website of the regulatory body. Provides access to regulations, circulars, and lists of registered insolvency professionals.
Detailed regulations governing the Corporate Insolvency Resolution Process, including specific provisions on the appointment and role of the IRP.
The official portal for the Adjudicating Authority. Provides information on case filings, orders, and procedures related to CIRP.
A blog post explaining the initial responsibilities and powers of an IRP upon appointment in the CIRP.
A comprehensive overview of the IBC, including sections detailing the initiation of CIRP and the appointment of interim professionals.
Discusses the legal framework and practical considerations involved in the appointment of an IRP under the IBC.
A video tutorial that visually explains the steps involved in the CIRP, including the initial appointment of the IRP.
Information from IBBI on the registration process and regulatory requirements for insolvency professionals, which is fundamental to IRP appointments.
A practical guide that breaks down the IBC, offering insights into the procedural aspects of CIRP and the role of the IRP.