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Interim resolution professional duties clarified under Insolvency and Bankruptcy Code, 2016 The judgment clarifies the duties of the interim resolution professional under the Insolvency and Bankruptcy Code, 2016, emphasizing the collection of ...
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Interim resolution professional duties clarified under Insolvency and Bankruptcy Code, 2016
The judgment clarifies the duties of the interim resolution professional under the Insolvency and Bankruptcy Code, 2016, emphasizing the collection of claims and control of assets. It outlines procedures for managing offshore assets, requiring coordination with the Administrator of the offshore regional hub. The role of the committee of creditors is left open for future determination, allowing their input in drafting agreements with offshore administrators. Compliance with the Code is highlighted throughout the decision, ensuring proper handling of assets and creditor claims, ultimately providing guidance for resolution professionals in similar cases.
Issues: 1. Duties of the interim resolution professional under the Insolvency and Bankruptcy Code, 2016. 2. Control and custody of assets of the corporate debtor situated outside India. 3. Role of the committee of creditors in such matters.
Analysis:
1. The judgment addresses the duties of the interim resolution professional under section 18 of the Insolvency and Bankruptcy Code, 2016. It emphasizes that upon initiation of the corporate insolvency resolution process, the interim resolution professional is mandated to collate the claims of financial creditors, operational creditors, etc., both domestic and international. Furthermore, the professional is required to take control and custody of all assets owned by the corporate debtor as recorded in various documents, including the balance-sheet of the corporate debtor, information utility, depository of securities, or any other registry documenting asset ownership.
2. The judgment specifically deals with the scenario where assets of the corporate debtor are situated outside the country. In such cases, the interim resolution professional can only take control and custody of these offshore assets after reaching an arrangement with the Administrator of the offshore regional hub. The resolution professional is tasked with collating the claims of offshore creditors and ensuring the assets situated abroad are appropriately managed in accordance with the provisions of the Insolvency and Bankruptcy Code.
3. Regarding the role of the committee of creditors in these matters, the judgment leaves this question open for decision at a later stage or in a different case. However, for the current situation, the committee of creditors is permitted to guide the resolution professional in preparing a draft agreement outlining the terms and conditions for engaging with the administrator of Holland. If the draft agreement is accepted by the Administrator of Holland, it is to be presented before the Appellate Tribunal for further consideration and approval. The resolution professional is directed to submit the draft agreement within a specified timeframe for review.
In conclusion, the judgment provides clarity on the duties of the interim resolution professional, the process of managing offshore assets of the corporate debtor, and the involvement of the committee of creditors in such situations, ensuring compliance with the Insolvency and Bankruptcy Code, 2016.
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