Duties of resolution professional before initiation of pre-packaged insolvency resolution process [ section 54B ] - Insolvency Resolution And Liquidation For Corporate Persons - IBC

Duties of resolution professional before initiation of pre-packaged insolvency resolution process [ Section 54B ] Under Pre-packaged insolvency resolution process, duties and powers of Insolvency professionals are described under the Code and Regulations made thereunder. We will first understand the requirements of Code and then the Regulations made thereunder with reference to provisions of respective sections of the Code. We will also bifurcate duties and powers in order to understand both the aspects independently. Duties of resolution professional under Prepackaged Insolvency Resolution Process Duties of resolution professional under Pre-packaged Insolvency Resolution Process are three-fold: Before initiation of Pre-packaged insolvency resolution process. [ Section 54B ] During Pre-packaged insolvency resolution process [ Section 54F(2) ] ;and Upon vesting of management of corporate debtor with resolution professional [ Section 54J(3)(e) ] ; The insolvency professional, proposed to be appointed as the resolution professional, shall perform following duties commencing from the date of the approval of his appointment by the financial creditors and his duties shall come to an end on the date of admission or rejection of the application for initiating Pre-packaged insolvency resolution process by the Adjudicating Authority or on the date mentioned in the declaration given by the Corporate Applicant by which he shall file an application for initiation of Pre-packaged insolvency resolution process and he failed to file such application by such date, as the case may be. Duties of resolution professional before initiation of pre-packaged insolvency resolution process [ Section 54B ] Section 54B(B)(1) state that, the insolvency professional, proposed to be appointed as the resolution professional, shall have the following duties commencing from the date of the approval under clause (e) of section 54A(2) , namely: Prepare a report in form F8 as may be specified, confirming whether the corporate debtor meets the requirements of section 54A, and the base resolution plan conforms to the requirements referred to in clause (c) of section 54A(4) . [ Section 54B (1) (a) read with Regulation 17 of IBBI (Pre-packaged Insolvency Resolution Process) Regulations, 2021 ] Resolution professional shall file such reports, forms, along with enclosures thereto, on an electronic platform, as may be required by the Board in consultation with insolvency professional agencies. [ Section 54B (1) (b) read with Regulation 13 of IBBI Pre-packaged Insolvency Resolution Process) Regulations, 2021 ] He shall perform such other duties as may be specified [ Section 54B (1) (C) ] . Cease the duties of Insolvency Professional [ Section 54B(2) ] The duties of the insolvency professional under section 54B(1) shall cease, if, (a) the corporate debtor fails to file an application for initiating pre-packaged insolvency resolution process within the time period as stated under the declaration referred to in clause (f) of section 54A(2); or (b) the application for initiating pre-packaged insolvency resolution process is admitted or rejected by the Adjudicating Authority, as the case may be. Fee payable to Insolvency Professional [ Section 54B(3) ] The fees payable to the insolvency professional in relation to the duties performed under section 54B(3) shall be determined and borne in such manner as may be specified and such fees shall form part of the pre-packaged insolvency resolution process costs, if the application for initiation of pre-packaged insolvency resolution process is admitted. Regulation 8(1) of the IBBI(Pre-packaged Insolvency Resolution Process) Regulations, 2021 provides that where the corporate debtor fails to file an application or the application for initiation of the process is rejected, the fee payable to the resolution professional for performing duties under section 54B(3) shall be born by the corporate debtor.