Insolvency and Bankruptcy Code, 2016

Section 93 - Standard of Conduct of Resolution Professionals

Section 93 of the Insolvency and Bankruptcy Code, 2016 (IBC) requires a resolution professional performing duties under the fresh start process to comply with the professional code of conduct referred to in Section 208. It connects the fresh start framework with the broader ethical and regulatory obligations governing insolvency professionals.

Text of Section 93 - Standard of conduct

93. Standard of conduct. - The resolution professional shall perform his functions and duties in compliance with the code of conduct provided under section 208.

Meaning and scope of Section 93

Section 93 appears in Chapter II (Fresh Start Process) of Part III of the IBC, which deals with insolvency resolution and bankruptcy for individuals and partnership firms. The section does not establish a separate code of conduct. Instead, it makes the standards in Section 208 applicable to the resolution professional while carrying out the responsibilities of a fresh start process.

Its practical purpose is to ensure that the professional entrusted with examining an application, handling creditor information and assisting the adjudicating authority acts diligently, transparently and within the applicable legal framework.

Section 208 - Functions and obligations of insolvency professionals

Section 208(1) concerns the functions an insolvency professional may undertake, subject to the terms of registration. Section 208(2) prescribes the following statutory conduct obligations:

Section 208(2)(a): Exercise reasonable care and diligence when performing professional duties.
Section 208(2)(b): Comply with the requirements and terms of the bye-laws of the insolvency professional agency of which the professional is a member.
Section 208(2)(c): Permit the insolvency professional agency to inspect professional records.
Section 208(2)(d): Submit copies of records of proceedings before the Adjudicating Authority to the Board and the relevant insolvency professional agency.
Section 208(2)(e): Perform functions in the prescribed or specified manner and subject to applicable conditions.

IBBI regulations and professional ethics

The Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016, including the Code of Conduct in their First Schedule, provide further professional standards. These address matters such as integrity, independence, objectivity, competence, proper disclosure, confidentiality and professional care, subject to the regulations as amended from time to time.

In particular, Regulation 7 sets conditions attached to an insolvency professional's registration, including compliance with the Code, applicable regulations, agency bye-laws and the First Schedule Code of Conduct. The latest applicable consolidated regulations and amendments should be checked on the IBBI legal framework portal.

Role in the fresh start process

The fresh start process provisions include examination of an application, reporting and creditor-related functions. In discharging any applicable statutory function, a resolution professional must apply Section 93 together with Section 208 and the relevant rules and regulations. Important connected provisions include:

Sections 80-84: Application and admission framework for the fresh start process.
Sections 85-90: Moratorium and related procedural provisions.
Section 91: Revocation of an order admitting an application in the circumstances specified by law.
Section 92: Discharge order following the fresh start process.
Section 208: Statutory functions and conduct obligations of insolvency professionals.

Commencement distinction: A provision appearing in the enacted IBC is not necessarily operational for every class of debtor. The fresh start process provisions have not been generally brought into force merely because other Part III provisions were notified for personal guarantors to corporate debtors. Always verify commencement notifications and the applicable debtor category before relying on the fresh start procedure.

Practical implications

A resolution professional should maintain accurate records, verify relevant information with reasonable care, avoid conflicts of interest, preserve confidentiality where required, comply with filing and reporting duties, and deal fairly with the debtor and creditors. Breaches of applicable professional obligations may lead to regulatory scrutiny or disciplinary action under the relevant statutory framework; Section 93 itself does not specify a standalone penalty.

Official legal references

For the full statute and related provisions, see The Insolvency and Bankruptcy Code, 2016.

Legal information only. Verify the current statutory text, commencement notifications and applicable regulations for a particular proceeding.