IBBI: IPs should work out resolution plans in time-bound manner

As the valuation of a stressed asset declines each day, insolvency professionals (IPs) should work on a resolution plan within a particular time frame, an official of the Insolvency and Bankruptcy Board of India (IBBI) said on Saturday.

Addressing a webinar organised by MCC, IBBI Whole Time Member Navrang Saini said IPs should be transparent and they should also ensure that resolution plans are worked out in a time-bound manner. “Value of a stressed asset declines every passing day. It has also been observed in some cases that the resolution value was almost close to the liquidation value,” Saini, who also serves as the IBBI Chairman, said.

A resolution was supposed to be completed within 180 days. In some cases, it had crossed more than 400 days, he said, adding there are some hitches still left in the resolution process which will go away with time.

Saini said there are nearly 3,900 IPs in the country, but many of them are not getting any assignment as some are monopolising them. “We are aiming at giving equal opportunity to all of them in the interests of the stakeholders,” he added.

According to Saini, when an insolvency professional takes charge of a stressed asset, the person becomes the CEO of the concerned corporation as the board gets suspended. An IP has to coordinate with the adjudicating authority — i.e. the NCLT — as well as the creditors, he said. IBBI has also provided a code of conduct for the IPs, but perfection will come with time, he added.