Charu Mathur: Sir, now my next question to you is about the IRPs and the valuation professionals, how do you see that?

U K Chaudhary: I see it as a great opportunity because as a past president of the ICSI we knew that ICSI was one of the institutions, which was given the opportunity of registering the insolvency professionals under the IB Code, and therefore the first hundred registrations came very quickly. So, later on, it was taken up by the Institute of Chartered Accountants and other institutions, and therefore the professional number of the IRPs have grown considerably now. But I still feel that there has to be some integrated process by which there must be more courses for IRPs. There must be more institutions which may develop and hone the skills of the IRPs so that they can take this onerous responsibility of running the corporates during the CIR process. And I also feel that since the valuation is an important part of every CIR process. The valuation issues are also becoming very important and I see a lot of scope for the registered valuers. IBBI i.e. the Insolvency and Bankruptcy Board of India is already registering the valuers as well as the IRPs because they are the authority which is registering them and have a regulatory control over them. So, there is a great scope for the valuers as well as the IRPs and I wish that more and more people come forward with the expertise. 

Charu Mathur: Sir, but if we look at the profession of IRP, I mean you are thrusting all the responsibility of erstwhile management on one person. So, there has to be some sort of transparency and accountability. How do you view that?

U K Chaudhary: I think, this has been a very conscious call on the part of the framers of legislation, because this is not how it operates in Europe and America, on the jurisdiction of insolvency, where the managements are not completely delinked from the CIR process, but it has been taken a conscious call that looking at the promoter’s interest and the attachment to the corporates. You know, we have a very typical situation, that our promoters are so emotionally attached to their companies that it’s very difficult for them to take any decision which is adverse to the effect of the corporates, or I can say it in other words, that actually there is a complete mixing of the feelings of the corporates and the families. They are so closely intertwined between themselves that they are not able to see the difference between a body corporate and the families’ interest. So, I think it was required, it was a very conscious call that as soon as the company goes into the CIR process, the promoters must be completely delinked. It soon has an advantage, it has some disadvantages also. Personally, speaking for myself, I would have preferred that IRP possibly could have been given a seat on the board, even as a chairman of the Board of Directors. And a veto, that if any decision is coming in the Board of Directors which is prejudicial to the interest of the CIR process, or against the COC, then it could have been vetoed down by them. But delinking the promoters completely has is own disadvantage because then he is completely lost of the support of the Board of Directors who have run that corporates for possibly a decade or two or more even. And therefore, there may be some disadvantages in that system, but in their wisdom, the legislation has so decided. But not that it has not worked even in most of the cases, it has worked wonderfully well and I’ll tell you that out of the first twelve cases, four at least, already stand resolved. And all others are in the process of getting resolved. And there are a number of other small institutions that have already seen the successful Corporate Insolvency Resolution Process. So there is not so terribly wrong with the IRPs and RPs, they are doing their best. The only thing required is that possibly they need to be skilled more, they should be more knowledgeable about their powers, there should be more knowledge. And if they can have some other outside support like the management support, where they could get on to the industry experts. Then those industry experts, in the absence of the Board of Directors possibly, can advise and this is how that the profession has to develop. I’m sure that in the coming years even that practice may develop and IRPs will do even a more efficient and more diligent job than what they are doing today.