REGULATORY UPDATE: MINISTRY OF COPRORATE AFFAIRS-INSOLVENCY PROFESSIONAL TO ENSURE COMPLIANCE WITH THE PROVISIONS OF THE APPLICABLE LAWS.

The IBBI vide its circular dated 3 January 2018 has directed Insolvency Professional that while acting as an Interim Resolution Professional, a Resolution Professional, or a Liquidator for a corporate person under the Code, an insolvency professional shall exercise reasonable care and diligence and take all necessary steps to ensure that the corporate person undergoing any process under the Code complies with all the applicable laws.

The IBBI circular further clarifies that if a corporate person during any of the aforesaid processes under the Code suffers any loss, including penalty, on account of non-compliance of any provision of the applicable laws, such loss shall not form part of insolvency resolution process cost or liquidation process cost under the Code and the Insolvency Professional will be responsible for the non-compliance of the provisions of the applicable laws on the corporate Person  if it is on account of his conduct.

Source:http://ibbi.gov.in/webadmin/pdf/legalframwork/2018/Jan/CIRP%202_2018-01-03%2018:42:00.pdf

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