Insolvency and Bankruptcy code

CA. Pravin Navandar, CA. Mukund Mall

New Compliance Requirement: Statement of Beneficial Ownership and Affidavit under CIRP Regulations

Circular Issued by: Insolvency and Bankruptcy Board of India on 29th December 2025

The Insolvency and Bankruptcy Board of India (IBBI) has introduced a new compliance mandate under Regulation 38(3A) of the Insolvency Resolution Process for Corporate Persons Regulations, 2016, effective from 23rd December 2025. This regulation requires every resolution plan to include:

Key Requirements

  1. Statement of Beneficial Ownership

    • Must disclose details of all beneficial owners of the Prospective Resolution Applicant (PRA).

    • Information includes:

      • Name, PAN/TIN, nationality, address.

      • Manner of ownership/control, including intermediate entities and jurisdictions.

    • Determination of “Beneficial Owner” will follow Rule 9(3) of the Prevention of Money Laundering (Maintenance of Records) Rules, 2005.

  2. Affidavit of Eligibility under Section 32A

    • A notarized affidavit declaring whether the PRA is eligible for immunity under Section 32A of the Code.

    • Must include:

      • Confirmation of authorization.

      • Basis for eligibility/ineligibility (e.g., promoter status, related party involvement, pending investigations).

Implementation: The Resolution Professional must ensure these documents form part of the resolution plan submitted to the Committee of Creditors and later filed before the Adjudicating Authority under Section 30(6) of the Code.

Legal Basis: Issued under powers conferred by Section 196 read with Section 240 of the Insolvency and Bankruptcy Code, 2016.

Why This Matters for Professionals

This move enhances transparency and accountability in the Corporate Insolvency Resolution Process (CIRP). Insolvency Professionals, Agencies, and Entities must update their compliance checklists to incorporate these new formats immediately.