The Bombay High Court has upheld the IBBI's Regulation 31A, permitting a 0.25% regulatory fee on the realisable value to creditors. This affirmation assures the standing of IBBI as a regulatory body during the Corporate Insolvency Resolution Process (CIRP).
Bombay HC Upholds IBBI's Authority to Levy Fee on Creditors
In a significant ruling, the Bombay High Court has affirmed the authority of the Insolvency and Bankruptcy Board of India (IBBI) to levy a 0.25% regulatory fee on the realisable value of assets owed to creditors under Regulation 31A. The court rejected claims challenging the Board's regulatory capacity during the Corporate Insolvency Resolution Process (CIRP).
The judgment reiterates the importance of Sections 196 and 240 of the IBBI Act, which delineate the Board's role as a regulator throughout the CIRP. The court found that the IBBI's regulatory oversight is crucial for ensuring transparency and stability in insolvency proceedings.
This ruling is crucial for practitioners involved in insolvency and corporate law, as it defines the regulatory landscape within which the IBBI operates. Legal professionals must stay abreast of the implications of such regulatory fees in insolvency matters.
Citations
- IBBI Regulation 31A (2026) 1 BHC 45
