Updated on: Oct 12th, 2021
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6 min read
An Insolvency Professional is one who is registered with the Insolvency and Bankruptcy Board of India (IBBI).
Insolvency Professional are enrolled with an Insolvency Agency and they are involved in the dissolution process of an insolvent individual, companies, LLPs or partnerships. These professionals are authorised to act on behalf of such insolvent individual, companies etc.
During the bankruptcy situation, the insolvency professionals play a vital role in liquidating the entity assets and other settlement processes. This process has gained momentum with the government bringing in strict norms through Insolvency and Bankruptcy Code.
Any agency registered with the IBBI u/s 201 of Insolvency Code, 2016 is referred as an insolvency professional agency.
The key function of these agencies are to regulate the activities of insolvency professionals and ensure their development in the industry. These professional members are required to comply with the terms and conditions as specified in the bye-laws of the insolvency agency code. IBBI exercises control over Insolvency professional agency and its professionals with respect to the complaints made under section 217 of Insolvency Code.
Following are the functions of Insolvency Professional Agency as specified in section 204 of Insolvency Code (with effect from 15-11-2016):
An individual is eligible to become an Insolvency Professional provided, he/she :
As a first step, any applicant must get themselves registered with Insolvency Professional agency. Listed below are the required qualifications and experience for an applicant to be registered as an Insolvency Professional:
Once the above-listedtions are fulfilled, the applicant can start practicing as an Insolvency professional.
The primary function of an Insolvency Professional is to assess the financial position of the company, partnership, LLPs, individual etc and to ensure smooth process of its dissolution. These professionals, in certain possible cases look for opportunities to rescue businesses. Otherwise the main functions of an Insolvency Professional are:
Insolvency professionals are registered with the IBBI and play a crucial role in the dissolution process of insolvent entities. The Insolvency Professional Agency regulates their activities and ensures compliance with specified standards. Eligibility criteria and qualifications are mandated for individuals to become Insolvency Professionals, necessitating registration with an Insolvency Professional agency. The primary functions of an Insolvency Professional include assessing financial positions, managing assets, handling settlements, and reporting to the National Company Law Tribunal.