Abstract

The enactment of the Insolvency and Bankruptcy Code (IBC) in 2016 marked a revolutionary step in India’s approach to insolvency resolution which significantly elevate the role of Insolvency Professionals (IPs). Initially designed to streamline insolvency procedures and protect creditors, the role of IPs has since evolved into a multi-dimensional responsibility encompassing administrative, regulatory as well as compliance functions. Insolvency professionals are at the heart of the IBC framework and responsible for managing the resolution process, conducting due diligence on creditor claims and ensuring compliance with the IBC's legal provisions. The duties of IPs have expanded since the code’s inception, with multiple amendments aimed at enhancing their operational efficiency. They are crucial in ensuring that Corporate Insolvency Resolution Processes (CIRP) progress smoothly by presenting and reviewing resolution plans, managing creditor claims and ensuring compliance with Section 30 of the IBC. One of the significant challenges faced by IPs is the increasing complexity of insolvency cases. Given the diverse nature of companies and the growing economic uncertainties, IPs need to balance creditor rights, facilitate consensus within the Committee of Creditors (CoC) and oversee asset valuations. The continued evolution of IP roles is further supported by the regulatory framework established by the Insolvency and Bankruptcy Board of India (IBBI), which introduces new guidelines and amendments to enhance the professional capabilities of IPs. These amendments also address issues like transparency and ensures that IPs work efficiently in resolving distressed assets while minimizing delays. Additionally, the shift towards increasing professional accountability, such as through stricter codes of conduct and continuing professional training ensures that the profession adapts to emerging challenges. The research will explore several key areas like the impact of judicial rulings on the role of IPs, how amendments to the IBC have introduced new responsibilities such as the verification of claims and restructuring distressed assets and the growing need for IPs to maintain professional conduct while facing complex negotiations. Furthermore, the research will assess how increased regulatory oversight and continued professional training are reshaping the future of IPs. The aim of this study is to provide a comprehensive overview of how the role of Insolvency Professionals has adapted to meet the dynamic needs of India's insolvency ecosystem. By tracing the evolution of IPs from compliance officers to strategic decision-makers, the research will highlight the challenges they face in ensuring procedural fairness, transparency and the efficient resolution of corporate insolvency cases. Moreover, the study will examine how IPs contribute to the economic stability of India by enabling distressed firms to either revive or undergo liquidation and thereby ensures a balance between growth, sustainability and financial resilience.

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