IBBI's latest regulation enforces for greater grievance redressal

The Insolvency and Bankruptcy Board of India (IBBI), in its recent notification, have called for greater grievance redressal through regulations which enable a stakeholder to file a grievance or a complaint against a service provider.

The IBBI, in its notification released earlier in the week, said these regulations provide for an objective and transparent procedure for disposal of grievances and complaints by the board that does not spare a mischievous service provider, and does not harass an innocent service provider.

Further, a stakeholder, who can file a complaint under the regulations include debtor, creditor, claimant, service provider, resolution applicant or any other person having an interest in an insolvency resolution, liquidation, voluntary liquidation or bankruptcy transaction under the Insolvency and Bankruptcy Code (IBC) 2016.

On the other hand, a service provider, against whom a complaint can be filed by a stakeholder under the regulations, includes insolvency professional agency, insolvency professional, insolvency professional entity or information utility.

The IBBI said a stakeholder might file a grievance that shall state details of the conduct of service provider that has caused suffering to the aggrieved; details include suffering, whether pecuniary or otherwise, aggrieved has undergone; how conduct of service provider caused suffering of aggrieved.

Stakeholder may file a complaint in Specified Form along with a fee of Rs 2,500. A complaint needs to state details of alleged contravention of any provision of the code or rules, regulations or guidelines made there under or circulars or directions issued by the IBBI among others.

Where IBBI is of opinion that there exists prima facie case, it may order an inspection under sub-regulation (3) of Regulation 3, order an investigation under sub-regulation (2) of Regulation 7 or issue a Show Cause Notice under sub-regulation (2) of Regulation 11 as may be warranted.

These regulations, the IBBI noted, are effective from Thursday, December 7, 2017.

On a related note, the Insolvency and Bankruptcy Code, 2016 provides for an effective and robust legal framework for time-bound Insolvency Resolution to release assets locked up in Non-Performing Asset (NPA) and promote maximisation of value of assets, failing which, under-utilised resources of unviable business are released through liquidation.