IBBI Issues Circular Regarding Withdrawal Of Unclaimed/Undistributed Amounts From Corporate Liquidation Account
The Insolvency and Bankruptcy Board of India (“IBBI”) has issued a circular dated 22.02.2024, intimating the procedure to be followed by the Liquidator for release of unclaimed dividends/ undistributed proceeds from the Corporate Liquidation Account in favour of entitled stakeholders. Brief background Regulation 46 of the IBBI (Liquidation Process) Regulations,...
The Insolvency and Bankruptcy Board of India (“IBBI”) has issued a circular dated 22.02.2024, intimating the procedure to be followed by the Liquidator for release of unclaimed dividends/ undistributed proceeds from the Corporate Liquidation Account in favour of entitled stakeholders.
Brief background
Regulation 46 of the IBBI (Liquidation Process) Regulations, 2016 (“Liquidation Regulations”) provides a framework for management of unclaimed deposits and undistributed proceeds during the liquidation process. Regulation 46 mandates the Liquidator of Corporate Debtor to deposit unclaimed/undistributed amounts into the Corporate Liquidation Account and inform the IBBI in Form-I of the Liquidation Regulations.
Procedure for release of amounts
When under Regulation 46(7) of the Liquidation Regulations, a stakeholder claims entitlement to any amount deposited into the Corporate Liquidation Account and requests for its withdrawal before dissolution of the corporate Debtor, then after verification the Liquidator shall apply to IBBI (in the form as per Annexure) for the release of the amount for onward distribution to the stakeholders.
Ref. No. IBBI/LIQ/69/2024
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