1.

Introduction
2. Constitution of the board
3. Features of the board
4. Powers and functions of IBBI
5. Advantages of IBBI
6. Disadvantages of IBBI
7. Conclusion
17 March 2024 01:26

Introduction
The Insolvency and Bankruptcy Code, 2016 which was enacted by the Indian Parliament to consolidate and
amend the existing laws relating to insolvency and bankruptcy in the country, established the Insolvency and
Bankruptcy Board of India (IBBI) in the year 2016. It is a very essential and important board of the
government.
The Insolvency and Bankruptcy Board of India (IBBI) is a very crucial authority. It oversees both professions
and transactions. IBBI is responsible for implementing the IBC and amending legislation for insolvency
resolution of corporate people, partnership companies, and individuals in a timely way in order to maximize
the worth of such a person’s assets.
Its main functions include registering insolvency professionals and insolvency professional agencies,
regulating the insolvency process, and promoting the development of an efficient insolvency system in India.
The IBBI also encourages credit availability, entrepreneurship, and the balance of all shareholders’ interests.
The main agenda of the Insolvency and Bankruptcy Board of India (IBBI) was to improve the bankruptcy
regime of the country. The IBBI is the main pillar in the implementation of the IBC.

Constitution of the board

The headquarter of the IBBI is at New Delhi, which is headed by the chairman of the board. All the members
of the board are appointed by the Central Government. The board in total consists of 10 members.
• One of them is the chairperson of the IBBI.
• Another person is a member nominated by The Reserve Board of India (RBI), ex- officio.
• Three members are officers of the Central Government who are equivalent or not below the rank of a Joint
Secretary. Each of these three members will represent the Ministry of Law, Ministry of Finance, and Ministry
of Corporate Affairs, ex-officio.
• The other five members are nominated by the central government, out of which at least three should be
working as whole-time members.
The term of office for the Chairperson and other members (other than the ex-officio members) is five years or
until they attain the age of sixty-five (65), whichever is earlier.
The re-appointment of the members is also eligible.
All the members of the board including the chairperson should be persons of ability, integrity, and standing
who have the capacity to deal with all the problems which relate to bankruptcy or insolvency. And should also
have special knowledge and experience in law, finance, economics, accountancy, or administration.

Features of the board

The Insolvency and Bankruptcy Board of India (IBBI), is a body corporate and has a perpetual succession.
IBBI also has a common seal and has the right to sue or be sued. The Insolvency and Bankruptcy Board of
India (IBBI) also has the powers subject to the provisions of the code, to acquire, and dispose of property,
and hold, both the movable and immovable.

Powers and functions of IBBI

The powers of The Insolvency and Bankruptcy Board of India (IBBI) are provided under section 196 of the
Insolvency and Bankruptcy Code.
1. IBBI facilitates the development and regulation of practices and working methods of the insolvency
professions, insolvency agencies, information utilities, and other institutions.
2. IBBI also levies charges or fees for registration and renewal of the insolvency professions, insolvency
agencies, and information utilities.
3. The minimum eligibility requirements for the registering insolvency professions, insolvency agencies, and
information utilities are registered, suspended, renewed, withdrawn, cancelled or specified by IBBI.
4. IBBI also specifies the standards and the regulation which are required for the function of the insolvency
professions, insolvency agencies, and information utilities.

Insolvency and Bankruptcy Board of India (IBBI) Page 1

 professions, insolvency agencies, and information utilities.
5. The Minimum curricula for the examination of bankruptcy professionals for enrollment in insolvency
professional organizations are also laid down in the IBBI.
6. The guidelines and the regulations on matters which are related to bankruptcy and insolvency required
under the IBC are also made by IBBI.
7. IBBI also issues guidelines for the timely disposition of corporate debtor/debtor assets.
8. The mechanism for the redressal of grievances against the insolvency professions, insolvency agencies, and
information utilities is specified by IBBI. The orders passed relating to the complaints filed against them, and
are complied with the provisions of IBC and the regulations.
9. The IBBI has the power to impose penalties, fines, and sanctions on individuals and entities that violate
the provisions of the IBC or the rules and regulations issued by the IBBI
10. It also has the power to initiate legal proceedings against such individuals and entities in appropriate
cases.
11. The grounds on which the insolvency professional can be expelled from their membership of insolvency
professional agencies are also given by IBBI.
12. Conduct research and studies on matters related to insolvency and bankruptcy.
13. Promote public awareness of the insolvency and bankruptcy laws and processes in India.
14. Investigate any misconduct by insolvency professionals and take necessary disciplinary action.
15. The IBBI also designates members to the different committees and panels established under the IBC, such
as the establishment of a governing board for the administration and internal governance of insolvency
professional agencies.
16. The Insolvency and Bankruptcy Board of India (IBBI) also provides guidance and assistance to insolvency
professionals and other stakeholders involved in the insolvency and bankruptcy process.
17. IBBI monitors and reviews the work of the insolvency professional who are the members.
18. The Insolvency and Bankruptcy Board of India (IBBI) also specifies the particular classes for the people
who will receive services at concessional rates.
19. The Insolvency and Bankruptcy Board of India (IBBI) also may exercise the powers which are vested in a
civil court under the Civil procedure code, 1908, along with exercising the powers under the IBC.
• It can enforce and summon the attendance of the person/persons and their examination on oath.
• The Board can ask to produce and discover the book of accounts and other documents, at such time as
specified by the board.
• The board can also inspect any books, documents, or registers of any persons at any place.

Advantages of IBBI
Some of the potential advantages of having such an agency include:
1. Improved legal framework for insolvency and bankruptcy:
The IBBI is responsible for implementing the IBC, which can help to ensure that insolvency and bankruptcy
proceedings are carried out in a fair and transparent manner.
2. Increased efficiency and speed in insolvency and bankruptcy proceedings:
The IBC and the regulations implemented by the IBBI are designed to streamline and expedite the insolvency
and bankruptcy process in India. This can help to ensure that insolvency and bankruptcy proceedings are
completed in a timely manner, which can benefit both creditors and debtors.
3. Improved credit culture in India:
The IBC and the IBBI’s regulations are intended to encourage a credit culture in India, where creditors are
more willing to lend and borrowers are more likely to repay their debts. This can help to support the
development of a healthy and functioning credit market in the country.
4. Greater transparency and accountability in insolvency and bankruptcy proceedings:
The IBBI is responsible for regulating the insolvency process and overseeing the conduct of insolvency
professionals. This can help to ensure that insolvency proceedings are conducted in a transparent and
accountable manner, which can help to build confidence and trust in the insolvency system.

Disadvantages of IBBI
While the Insolvency and Bankruptcy Board of India (IBBI) has some potential advantages, there may also be
some disadvantages to having such an agency. Some potential disadvantages of the IBBI include:
1. Potential for regulatory burden and compliance costs:
The IBBI is responsible for implementing the Insolvency and Bankruptcy Code (IBC) and overseeing the
insolvency process in India. This may involve the implementation of new regulations and requirements,
which could potentially create additional compliance costs and administrative burdens for insolvency
professionals and other stakeholders.
2. Limited ability to enforce regulations and sanctions:
Insolvency and Bankruptcy Board of India (IBBI) Page 2
2. Limited ability to enforce regulations and sanctions:
The IBBI is an independent agency, but it does not have the power to enforce its regulations or impose
sanctions on individuals or firms that fail to comply with the IBC or the IBBI’s regulations. This may limit the
effectiveness of the IBBI in promoting compliance with the insolvency and bankruptcy laws in India.
3. Potential for conflicts of interest:
The members of the IBBI are appointed by the central government, which may create potential conflicts of
interest if the government has a financial stake in the outcome of an insolvency or bankruptcy proceeding.
This could potentially undermine the fairness and impartiality of the insolvency process.
4. Limited scope of authority:
The IBBI’s authority is limited to overseeing and regulating the insolvency and bankruptcy process in India.
It does not have jurisdiction over other areas of the financial system, such as banking, insurance, or securities
markets. This may limit the agency’s ability to address broader issues related to financial stability and market
integrity.

Conclusion
In conclusion, the Insolvency and Bankruptcy Board of India (IBBI) plays an important role in promoting
entrepreneurship and facilitating the resolution of insolvencies in India.
The IBBI’s regulatory oversight helps ensure that insolvency professionals and information utilities operate
in a transparent and fair manner, which is essential for the smooth functioning of the insolvency and
bankruptcy process in India. This, in turn, helps protect the interests of all stakeholders involved in the
process, including creditors, debtors, and investors.
In addition, the IBBI’s efforts to promote public awareness of the insolvency and bankruptcy laws and
processes in India help encourage entrepreneurship and facilitate the resolution of insolvencies in a timely
and efficient manner. This helps foster a more conducive business environment in India and ultimately
benefits the economy as a whole.
Overall, the role of the IBBI is to ensure that the insolvency and bankruptcy laws in India are implemented in
a fair and transparent manner and to support the development of a healthy and functional insolvency system
in the country.

Insolvency and Bankruptcy Board of India (IBBI) Page 3