“India’s Debt market is bad and over Rs 25,000 crores that is blocked as “Stressed Assets” in the economy can be unlocked in five years with the ICSI training insolvency professionals through the ICSI Insolvency Professional Agency,” Mamta Binani, President, Institute of Company Secretaries of India, said at a joint national conclave on “Insolvency & Bankruptcy Code, 2016” organized by ICSI and NSE here on Friday.
The ICSI has received registration from the Insolvency and Bankruptcy Board of India (IBBI) through a certificate awarded recently by Union Finance and Corporate Affairs Minister Arun Jaitley, who had stated that the Central Government’s initiative of setting up a modern insolvency mechanism was based on best practices globally and set up in the shortest possible time. “An Insolvency Professional Agency is a frontline regulator for insolvency professionals by enrolling professional members, laying down standards of professional conduct for them and monitoring their performance while redressing consumers grievances against its members,” Jaitley had said.
Describing the Insolvency & Bankruptcy Code, 2016 as a new Code that will take time to settle in, she said the global view of India’s economy being ‘robust’ is because “we have learnt from the mistakes of other nations.” The new Code proposes insolvency professionals for the conduct of insolvency resolution process and liquidation process, where they will function under the oversight of IPA and IBBI and be subject to code of conduct of IPA model byelaws, she said, adding that the Insolvency Regulator will exercise regulatory oversight over: Insolvency Professionals; Insolvency Professional Agencies and Information Utilities. “As of on Friday, ICSI has less than 100 registered insolvency professionals and the newly registered professionals would be created as a different set of professionals for resolving disputes between creditor and debtor in case of corporate and individual insolvencies, where the adjudicating authority for corporate insolvency is NCLT, and individual insolvency is DRT. However, the IBBI cannot function with barely 100 professionals and this number will go up to 1,000 after conducting related exams for related incoming professionals (some having even 10 years insolvency experience), chartered accountants, company secretaries and even lawyers (some with 40 years experience), besides MBAs and Graduates being added later on,” she said.
Pointing out that the ICSI has come out with an “e-book” on the Companies Act, and added it on the ICSI website also, she said this would greatly help ‘Start-ups’ and companies accessing it. ICSI would be conducting training courses for even experienced insolvency professionals and then enroll them as members in a step closer towards implementation of the Insolvency & Bankruptcy Code 2016, Binani said, while stating “The Insolvency professionals course is tough with 60% passing criteria and the first such exam would be held online on December 31, 2016.”
Emphasizing the effectiveness of the Code and its institutional mechanism for its implementation, Binani highlighted its scope that Company secretaries too could seize upon and urged them to get registered with the ICSI Insolvency Professional Agency to render their services.
Earlier, Dr M S Sahoo, Chairman of Insolvency and Bankruptcy Board of India who was the chief guest, said implementation of Insolvency & Bankruptcy Code will ensure a timely solution to the insolvency resolution of companies. This has a good mechanism to unlock the value of distressed assets and is a shift from Debtor’s regime to Creditor’s regime, he said.