Appointment of Authorised Representative for Classes of Creditors in ongoing CIRP

By INSOL INDIA EDITORIAL TEAM Posted On : August 15, 2018

 

 

As per Section 21 (6A) (b) of the Code read with Regulation 16A (1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (“the Regulations”), the IRP shall offer a choice of three IP where the corporate debtor has at least ten financial creditors in a class. A creditor in the class may indicate its choice of an IP, from amongst the three, to act as its authorised representative. The IP, who is the choice of the highest number of creditors in the class, is appointed as the authorised representative of the creditors of the respective class. The IBBI pursuant to its circular dated July 13th, 2018 has directed the IPs that the above mechanism is followed where creditors belonging to class are not represented in the CoC irrespective of the stage of process and facilitate representation of such creditors. Where the approval of resolution plan under regulation 39 (3) of the Regulations is at least 15 days away, the resolution professional shall expeditiously obtain, by electronic means, the choice of the IP from creditors in a class to act as the authorised representative of the class and proceed further in the manner as specified in regulation 16A of the Regulations.