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In aid of Insolvency Professionals conducting Liquidation Process – IBBI Facilitation/002/2020 dated 05.08.2020

The Adjudicating Authority (AA), the National Company Law Appellate Tribunal (NCLAT), and High Courts, through their orders and judgements, have guided liquidators in the conduct of liquidation process. This communication presents a few significant directions and observations from these orders and judgements, which an IP may find useful. These are presented under the following six broad categories: A. Taking Charge as Liquidator, etc. B.Scope of Liquidation Estate, etc. C. Sale of Assets, etc. D. Attachments, etc. E.Managing the Affairs, etc., and F. Powers and Duties, etc.

A liquidator can proceed with the sale of the assets even if it is under attachment by Directorate Of Enforcement – Section 32A of IBC – Mr. Anil Goel (Liquidator in Respect Of Varrsana Ispat Limited) Vs. Deputy Director, Directorate Of Enforcement, Delhi – NCLT Kolkata

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Section 29A of the Indian Arbitration & Conciliation Act to have a Retrospective effect: Clarifies the Delhi HC – By Rahul Kumar

The Hon’ble Delhi High Court on 21st July 2020, clarified the position of application of section 29A(1) of the Indian Arbitration and Conciliation Act, 1996. The court while deciding the issue of application of section 29A(1) in the matter of ONGC Petro Additions Ltd. v. Ferns Construction Co. Inc. [2020] ibclaw.in 24 HC held that section 29A(1) of the Arbitration and Conciliation Act, as amended in 2019 shall have the retrospective application.

Whether the Resolution Professional with the approval of CoC, was authorized to accept the Resolution Plans after the expiry of the deadline for submission of the Bid, without extending the timeline for submission of EOI? – Kotak Investment Advisors Limited Vs. Mr Krishna Chamadia (Resolution Professional in the matter of Ricoh India Limited) – NCLAT New Delhi

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During the Liquidation Proceedings of the Corporate Debtor, appropriate criminal/civil proceedings, if any, can be initiated before the Appropriate Authority and Forum – Dr. Vandana Parvez Tamil Nadu Vs. IVRCL Ltd. (Corporate Debtor& Ors.) Represented by Sutanu Sinha (RP for IVRCL) – NCLAT

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IBBI (CIRP) (Fourth Amendment) Regulations, 2020 – No. IBBI/2020-21/GN/REG064 dated 07.08.2020

The Insolvency and Bankruptcy Code, 2016 (Code) envisages appointment of an authorised representative (AR) by the Adjudicating Authority to represent financial creditors in a class, like allottees under a real estate project, in the committee of creditors. For this purpose, the Regulations require the interim resolution professional to offer a choice of three Insolvency Professionals (IP) in the public announcement, and the creditors in a class to choose one of them to act as their authorised representative. The amendment made to the Regulations today provides that the three IPs offered by the interim resolution professional must be from the State or Union Territory, which has the highest number of creditors in the class as per records of the corporate debtor. This will facilitate ease of coordination and communication between the AR and the creditors in the class he represents.

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