IBC – Liquidator’s fees – Clarification Circular dated 28.9.2023 on the different interpretation of terms -IBBI (LP) Regulations 2016
IBC – Liquidator’s fees – Clarification Circular dated 28.9.2023 on the different interpretation of terms -IBBI (LP) Regulations 2016
Regulation 4 of IBBI (Liquidation Process) Regulations, 2016, provides for the fees of Liquidator in two parts – (i) fees to be decided by the Committee of Creditors or Stakeholders Consultation Committee and (ii) if such fees is not fixed, then the Liquidator is entitled to a fee as a percentage of the amount realised net of other liquidation costs and of the amount distributed, for the balance period of liquidation.
There are and were different interpretations on the fees to be fixed by the Liquidator.
Circular dated 28.9.2023 provides for salutary, comprehensive and illustrative clarification on different interpretations on the terms of “Amount of Realisation (exclusive of liquidation costs)” and “Amount Distributed to Stakeholders” in Regulation 4(2)(b) of the Regulations, 2016.
Even an illustrative chart and computation is given showing as to how the Liquidator’s fee is erroneously computed.
To my mind, the circular will clear the air and will go a long way to help the stake holders as also the Liquidator.
276e15152ac2147c101fcbfbf37d0ddb.pdf (ibbi.gov.in)
