INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (ADVISORY COMMITTEE) REGULATIONS, 2017 – AN OVERVIEW

[Mr. M. GOVINDARAJAN]

The Insolvency and Bankruptcy Board of India (‘Board’ for short)  made the ‘Insolvency and Bankruptcy Board of India (Advisory Committee) Regulations, 2017 (‘Regulations’ for short) in exercise of powers conferred by Section 197 read with Section 240 of the Insolvency and Bankruptcy Code, 2016 (‘Code’ for short)  vide Notification No. IBBI/2016-17/GN/REG008, dated 30.01.2017.  These regulations came into effect from 31.01.2017.

Advisory Committee

Section197 of the Code provides that the Board may, for the efficient discharge of its functions, may constitute advisory and executive committees or such other committees, as it may deem fit, consisting of a Chairperson and such other members as may be specified by regulations.

Regulation 3(1) provides that the Board may constitute an Advisory Committee by order in writing, obtain expert advice on issues relevant for the efficient discharge of its functions.  Every order shall provide for composition of the Advisory Committee and the broad issues under its purview.   The Advisory Committee may advise the Board on any issue under its purview on its own and shall advise and provide professional support on any issue on a request from the Board.

Committees

Regulation 3(2) provides that the Board may constitute the following committees-

• Advisory Committee on service providers;
• Advisory Committee on Corporate Insolvency and Liquidation;
• Advisory Committee on Individual Insolvency and Bankruptcy; and
• Any other subject specific Advisory Committee as the Board consider expedient from time to time.

Composition of Advisory Committee

Regulation 4 provides that an Advisory Committee shall comprise of-

• Professional members, who are eminent academicians or practitioners in the relevant area; and
• General members, who are eminent citizens not having direct involvement or interest in the area.

The professional members and general members shall roughly in the ratio of 2:1.   Restriction is there that no person shall be a member of more than one Advisory Committee at any point of time.

The Board shall designate one of the general members of the Advisory Committee as its Chairperson and one of its senior officers as Secretary to the Advisory Committee.  The Secretary shall have the right to speak, but not vote on any issue in the meetings of the Advisory Committee.

Tenure

The term of a member shall not exceed 3 years.  A person shall be eligible for reappointment as member of the same or another Advisory Committee.

Meetings of the Committee

Regulation 5 provides that an Advisory Committee shall meet at such times and places as it considers expedient.  50% of the existing strength of the Committee shall constitute the quorum for the meeting.  The Secretary shall convene the meetings of the Committee and he has to maintain records of meetings.  The Chairperson shall decide the agenda for the meeting and preside over the meetings of the Committee.

Sitting fee

Regulation 6 provides that a member of the committee shall be entitled to a sitting fee of ₹ 10,000/- for a meeting in addition to the reimbursement of expenses on his travel and accommodation for attending the meetings of the committee at par with the entitlement of Secretary to Government of India.

Conduct

Regulation 7 provides that no member of the Advisory Committee shall communicate to the press or to any other public media on issues that have been considered or are under consideration of the Committee.  A member, who is directly or indirectly interested in any issue coming up for consideration in a meeting of the committee, shall disclose the nature of his interest at such meeting.  A member shall not take part in any deliberation or discussion of the Committee with respect to such business except to the extent of professional advise if sought by the committee.

Existing Committees

The Board constituted two Advisory Committees as under-

• Advisory Committee on Service Providers – This Committee consists of the following members-

  • Shri Mohandas Pai , Chairman, Manipal Global Education – Chairperson;
  • Dr. Ajay N. Shah, Professor, National Institute of Public Finance and Policy;
  • Shri Amarjit Singh Chadhiok, Senior Advocate;
  • Dr. Bimal N. Patel, Director and Professor of Public International Law, Gujarat National Law University;
  • Shri J. Ranganayakulu, Executive Director (Law),SEBI;
  • Shri K.V.R. Murty, Joint Secretary, Ministry of Corporate Affairs;
  • Shri Ravi Narain, Vice Chairman, National StockExchange of India Limited;
  • President, the Institute of Chartered Accountants of India;
  • President, the Institute of Company Secretaries of India;

The Advisory Committee shall advise and provide professional support to the IBBI on regulation and development of the service providers on a request from the Board.   It may advise on these matters on its own also.

• Advisory Committee on Corporate Insolvency Resolution and Liquidation – This committee consists of the following members-
  • Shri Uday Kotak, Executive Vice Chairman and Managing Director, Kotak Mahindra Bank – Chairperson;
  • Shri Ashish Kumar Chauhan, Managing Director and Chief Executive Officer, BSE Limited;
  • Shri Gyaneshwar Kumar Singh, Joint Secretary to Government of India, Ministry of Corporate Affairs;
  • Shri M.V. Nair, Chairman, Credit Information Bureau (India) Limited;
  • Dr. Omkar Goswami, Chairperson, CERG Advisory Private Limited;
  • Shri Somshekhar Sundaresan, Legal Counsel;
  • Present, NCLT & NCLAT Bar Association;
  • Present, the Institute of Cost Accountants of India;

 The Advisory Committee shall advise and provide professional support to the IBBI on matters relating to Corporate Insolvency Resolution and Liquidation on a request from the IBBI. It may advise on these matters on its own also.