The Insolvency and Bankruptcy Board of India, (IBBI) on October 05, 2023, issued a discussion Paper on Streamlining the Voluntary Liquidation Process.
The following proposals are suggested-
•Form H and final report may be submitted on the electronic platform to be notified by Circular by the Board.
•If the liquidator fails to liquidate the corporate person within the stipulated period of 90 days or 270 days as the case may be, he shall hold a meeting of contributors of the corporate person and file within fifteen days after the end of the quarter in which the stipulated period for completion of liquidation has expired, a Status Report to the Board explaining why the liquidation has not been completed and specify, along with reasons, the additional time that shall be required for completing the process.
•The directors of the corporate person while making a declaration for initiation of the process, shall also make a Disclosure about pending proceedings or assessments before statutory authorities, and pending litigation, in respect of the corporate person, and Sufficient provision has been made to meet the obligations arising, if any, on account of these pending matters.
•Where a request for withdrawal is received from the claimant, the Board shall direct the liquidator in all such cases where a dissolution order has not been passed, for verification of the claim. This includes checking the legitimacy of the claim, the amount involved, and any other relevant details. Post verification, the liquidator shall submit their findings and opinion to the IBBI to enable it to permit withdrawal even before dissolution. Sharing final report and Form H.
•If the corporate person falls under the category of financial service provider, it shall declare that: (a) the category of financial service provider has been notified by the central government under section 227 of the Code (b), the declaration by corporate person shall also provide that the corporate person has obtained prior permission of appropriate regulator for initiating voluntary liquidation proceedings. Withdrawal from Corporate Voluntary Liquidation Account
•Regulations may be amended to provide for submission of an order of dissolution to the Board, along with the final data in the electronic platform to be notified by Circular by the Board.
Comments may be submitted electronically by October 26, 2023, for the six (6) proposals discussed above, along with the draft Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) (Amendment) Regulations, 2023.
[Notification No. IBBI/2022-23/GN/REG091]
