Resolution Professional in India: Understanding the Role, Duties, Eligibility & IBC Framework

The Insolvency and Bankruptcy Code (IBC), 2016 introduced a structured mechanism for resolving insolvency cases and improving the efficiency of the corporate insolvency process in India. A key professional responsible for managing this process is a resolution professional who plays an important role in protecting stakeholder interests and ensuring compliance with the IBC framework.

A Resolution Professional in India acts as a bridge between the insolvent company, creditors, and other stakeholders. Their responsibilities involve managing the affairs of the corporate debtor, facilitating the resolution process, and ensuring that all actions are conducted transparently according to legal requirements.

Who is a Resolution Professional?

A resolution professional is an insolvency professional appointed to oversee the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code. The professional takes control of the company’s operations during insolvency proceedings and works toward finding a viable resolution plan for the revival of the business.

Initially, an Interim Resolution Professional is appointed by the National Company Law Tribunal (NCLT) after accepting an insolvency application. The Interim Resolution Professional manages the company’s affairs temporarily and performs essential duties until the committee of creditors decides whether to continue with the same professional or appoint another resolution professional.

Role and Responsibilities of a Resolution Professional

The responsibilities of a resolution professional are extensive and require strong knowledge of insolvency laws, financial management, and corporate governance. Some major duties include:

• Taking control and custody of the assets and operations of the corporate debtor.

• Collecting and verifying claims submitted by creditors.

• Forming and managing the Committee of Creditors (CoC).

• Maintaining accurate records of the insolvency proceedings.

• Protecting the value of the company’s assets during the resolution period.

• Inviting and evaluating resolution plans from potential applicants.

• Ensuring that the approved resolution plan follows IBC regulations.

The resolution professional does not act as an owner of the company but functions as an administrator responsible for maintaining business continuity and facilitating the resolution process.

Eligibility Requirements to Become a Resolution Professional

To become a resolution professional in India, an individual must meet certain qualifications prescribed under the Insolvency and Bankruptcy Code and related regulations. The professional must:

• Be registered as an insolvency professional with the Insolvency and Bankruptcy Board of India (IBBI).

• Complete the required examination and registration process.

• Have the necessary experience and professional expertise in areas such as finance, law, accounting, or management.

• Follow the code of conduct established for insolvency professionals.

These requirements ensure that only qualified professionals handle complex insolvency matters involving companies and financial stakeholders.

Complete IBC Process Involving a Resolution Professional

The Corporate Insolvency Resolution Process generally begins when a financial creditor, operational creditor, or corporate applicant files an insolvency application before the NCLT.

Once the application is admitted:

1. The NCLT appoints an Interim Resolution Professional.

2. A public announcement is made inviting claims from creditors.

3. The Interim Resolution Professional verifies claims and forms the Committee of Creditors.

4. The CoC may appoint a resolution professional to continue managing the process.

5. Resolution applicants submit plans for restructuring or revival of the company.

6. The CoC evaluates and approves a suitable resolution plan.

7. The approved plan is submitted to the NCLT for final approval.

If no resolution plan is approved within the prescribed timeline, the company may proceed toward liquidation as per IBC provisions.

Importance of Resolution Professionals in Corporate Insolvency

Resolution professionals contribute significantly to maintaining fairness and transparency during insolvency proceedings. Their expertise helps maximize asset value, safeguard creditor rights, and support the possibility of business revival.

Professional advisory firms like ASC Group assist businesses, creditors, and stakeholders by providing expert guidance on insolvency, restructuring, and compliance matters. With a strong understanding of regulatory frameworks, ASC Group supports clients in navigating complex IBC procedures effectively.

Conclusion

The role of a resolution professional CIRP is crucial in India’s insolvency ecosystem. From managing the initial stages of CIRP to assisting in the approval of resolution plans, these professionals ensure that insolvency cases are handled in a structured and legally compliant manner. As the importance of IBC continues to grow, skilled resolution professionals remain essential for achieving successful corporate resolutions. Original Source