Section 89: Replacement of Resolution Professional under the Insolvency and Bankruptcy Code, 2016
Section 89 sets out how a debtor or creditor may seek replacement of a resolution professional in the fresh start process, how the Adjudicating Authority refers the request to the Insolvency and Bankruptcy Board of India (IBBI), and how records and responsibilities are transferred.
What Section 89 provides
Section 89(1) - Right to request replacement. A debtor or creditor who considers that the resolution professional appointed under Section 82 should be replaced may apply to the Adjudicating Authority for replacement.
Section 89(2) - Reference to the Board. Within seven days of receiving that application, the Adjudicating Authority must refer the matter to the Board for replacement of the resolution professional.
Section 89(3) - Recommendation by the Board. Within ten days after receiving the reference, the Board must recommend an insolvency professional against whom no disciplinary proceedings are pending.
Section 89(4) - Appointment of the replacement. The Adjudicating Authority appoints another resolution professional for the fresh start process based on the Board's recommendation.
Section 89(5)(a) and (b) - Handover and cooperation. The Adjudicating Authority may direct the outgoing resolution professional to share all information concerning the fresh start process with the incoming professional and cooperate as required.
These are explanations of the statutory subsections. For the authoritative legislative wording, consult the IBBI-hosted text of the Insolvency and Bankruptcy Code, 2016 (PDF) and the India Code portal.
Replacement procedure under Section 89
- Application: The debtor or creditor applies to the Adjudicating Authority, identifying the resolution professional appointed under Section 82 and explaining why replacement is sought.
- Reference: The Adjudicating Authority refers the application to IBBI within seven days of receipt.
- Recommendation: IBBI recommends a suitable insolvency professional with no pending disciplinary proceedings within ten days of receiving the reference.
- Appointment: The Adjudicating Authority appoints the recommended replacement.
- Handover: The outgoing professional may be directed to transfer information and cooperate with the incoming professional.
Section 89 does not prescribe a separate fixed number of days for the final appointment or handover. The seven-day and ten-day periods apply to the particular stages identified above.
Important statutory timelines
| Stage | Responsible authority | Statutory time |
|---|---|---|
| Refer replacement request to IBBI | Adjudicating Authority | Within 7 days of receiving the application |
| Recommend a replacement professional | IBBI | Within 10 days of receiving the reference |
| Appoint replacement | Adjudicating Authority | No separate deadline specified in Section 89 |
| Transfer information and cooperate | Outgoing resolution professional | As directed by the Adjudicating Authority |
Meaning of important legal terms
Resolution professional
An insolvency professional appointed under the relevant provisions of the Code to perform statutory functions in the fresh start process. Section 82 concerns the initial appointment; Section 89 concerns replacement.
Adjudicating Authority
The forum designated under the applicable provisions of Part III of the Code to hear and decide the relevant application. The correct forum depends on the category of debtor and operative commencement provisions; see Sections 179 and 60 where applicable.
Board
The Insolvency and Bankruptcy Board of India (IBBI), the statutory regulator established under the Code. Under Section 89(3), it recommends the replacement professional.
Fresh start process
The statutory process contemplated by Sections 80 to 93 for eligible individual debtors, subject to commencement and other applicable legal requirements. It is distinct from the insolvency resolution process in Chapter III of Part III.
Frequently asked questions
Who may seek replacement under Section 89?
Either the debtor or a creditor may apply to the Adjudicating Authority in relation to the professional appointed under Section 82.
Can the debtor appoint a replacement directly?
No. Section 89 provides for a reference to IBBI, a recommendation by IBBI, and appointment by the Adjudicating Authority.
Must the outgoing professional hand over the case records?
The Adjudicating Authority may direct the outgoing professional to share all information relating to the fresh start process and cooperate with the replacement under Section 89(5).
Is Section 89 the same as Section 98?
No. Section 89 relates to the fresh start process, while Section 98 addresses replacement of a resolution professional in the separate insolvency resolution process under Part III.
Official legal sources
Read the IBC text published by IBBI, consult the India Code database for legislation, and check the IBBI legal framework for subsequent notifications, amendments and regulations. For a wider overview, see The Insolvency and Bankruptcy Code, 2016.
Legal information only. Verify commencement, current amendments and applicable procedural rules before taking action in an individual case.