IBBI allows liquidators to modify stakeholder list on new information
Under the earlier regime the liquidator could not change this list independently and had to apply to the Adjudicating Authority- usually the National Company Law Tribunal (NCLT)- for modifications.
The Insolvency and Bankruptcy Board of India (IBBI) has introduced a new regulation allowing liquidators to update the list of stakeholders when new information becomes available, without seeking prior approval. According to a gazette notification, liquidators can modify an entry in the stakeholder list if they come across additional information that necessitates such changes.
They must also inform the Adjudicating Authority about the modification within 30 days of making it. This amendment, which took effect on Wednesday, marks a significant shift from the previous system, where liquidators could not alter the stakeholder list independently and had to apply to the Adjudicating Authority, typically the National Company Law Tribunal (NCLT), for any required modifications.
The updated regulation is anticipated to enhance the flexibility of liquidators in correcting or updating stakeholder records as new documents, claim-related information, or other pertinent facts emerge during the liquidation process. The stakeholder list is a crucial document that records the claims admitted by the liquidator and identifies the creditors and other stakeholders involved in the process.
Any changes to the list can have implications for the recognition of claims and the participation of stakeholders in consultations during the liquidation.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
