The Insolvency and Bankruptcy Board of India has amended corporate insolvency resolution process ( CIRP ) regulations with effect from 15th day of February, 2024.
Procedures for Voting: The CoC is empowered to decide the period of opening of electronic voting window with a minimum of twenty-four hours and a maximum of seven days with further increments of twenty-four hours each. The amendment also notes that where the matters listed for voting have already received requisite majority vote, the RP shall provide one last opportunity to vote by extending the voting window by a maximum period of twenty-four hours.
Operating separate bank accounts for real estate projects: Now it has become mandatory to have a separate bank account for each real estate project under a corporate debtor.
Monthly meetings of CoC: The RP is now mandated to convene a CoC meeting at least once in every thirty days and power has been granted to extend the interval between meetings to a maximum of one meeting per quarter, if CoC so decides.
Approval of insolvency resolution process costs: the amendment mandates that the RP to seek approval from the CoC for all costs including going concern costs related to the insolvency resolution process.
Fair value in the information memorandum to be disclosed: The fair value has now been made part of the information memorandum but the CoC, after recording the reasons, can decide not to share such an information where in it’s considered view such a disclosure is not beneficial for the resolution.
Valuation methodology to be disclosed: The amendment states to provide explanation for valuation methodology to the members of the CoC before the computation of estimates.
Flexibility to be ensured in inviting resolution plans in real-estate cases: The amendment notes that after due examination, the CoC may direct the RP to invite separate plan for each project.
Continuation of the resolution process pending extension application: The RP should continue to discharge his responsibilities under the resolution process till an application for extension is being decided by the Adjudicating Authority.
Monitoring committee for implementation of resolution plan: The amendment now grants power to the CoC to decide for constitution of a monitoring committee for overseeing the implementation of the resolution plan. From now on the committee may include the RP, any other insolvency professional or any other person as its member. In case the RP is made part of the committee, the monthly fee payable to him shall not exceed the monthly fee received by him during the corporate insolvency resolution process.
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