Resolution Professional to Conduct Corporate Insolvency Resolution Process: Role, Powers and Recent Regulatory Developments

Introduction

When a company slides into financial distress, Indian law no longer leaves its fate to a slow, litigation-heavy winding-up process. Under the Insolvency and Bankruptcy Code, 2016 (IBC), the moment a Corporate Insolvency Resolution Process (CIRP) is triggered, control of the company passes out of the hands of its own board and into those of an independent, regulator-recognised professional - the Resolution Professional (RP). Section 23 of the IBC, titled "Resolution professional to conduct corporate insolvency resolution process," is the statutory anchor for this arrangement, and it is worth unpacking in detail, both for its plain text and for how its practical application has evolved through IBBI regulations and judicial interpretation.

The Statutory Foundation: Section 23 of the IBC

Section 23(1) provides that, subject to Section 27, the Resolution Professional shall conduct the entire corporate insolvency resolution process and manage the operations of the corporate debtor throughout the CIRP period. Section 23(2) clarifies that the RP exercises the same powers and performs the same duties that were vested in the Interim Resolution Professional (IRP) under the relevant chapter of the Code. Section 23(3) requires that where a new RP is appointed in place of the IRP, the IRP must hand over all information, documents, and records relating to the corporate debtor to the incoming RP.

A significant proviso attached to this framework, introduced through amendments to the Code, extends the RP's responsibility beyond the nominal CIRP period: where a resolution plan has been submitted to the Committee of Creditors (CoC) under Section 30(6), the RP continues to manage the corporate debtor's operations even after the CIRP period technically expires, until the Adjudicating Authority passes its order under Section 31. This ensures there is no vacuum in the management of the corporate debtor while a resolution plan awaits approval.

From IRP to RP: The Appointment Journey

The CIRP begins with the appointment of an Interim Resolution Professional, typically proposed by the financial creditor or corporate applicant who files the insolvency application. Upon admission of the application by the National Company Law Tribunal (NCLT), the powers of the corporate debtor's board of directors stand suspended, and control passes to the IRP. The IRP makes a public announcement inviting claims from creditors, collates and verifies those claims, and constitutes the Committee of Creditors based on the financial creditors who come forward.

At its first meeting, the CoC decides, by the requisite majority, whether to continue with the IRP as the Resolution Professional or to replace them with someone else. Where the CoC resolves to confirm the IRP as RP, this decision must be communicated to the corporate debtor, the IBBI, and the Adjudicating Authority within a prescribed period. Where the CoC instead decides to replace the IRP, or later replace a sitting RP under Section 27, the written consent of the proposed replacement must be obtained in the form notified by the IBBI - a procedural safeguard reinforced through recent regulatory amendments to ensure that professionals stepping into a CIRP do so with informed consent to its specific facts.

Powers and Functions of the Resolution Professional

Once appointed, the RP effectively steps into the shoes of the company's board of directors for the duration of the CIRP. The RP's principal powers and functions include:

• Taking custody and control of all assets of the corporate debtor, including its business records, IT systems, and statutory registers.
• Managing the operations of the corporate debtor as a going concern, so that the underlying business retains value pending resolution.
• Collating claims received from creditors and constituting or maintaining the Committee of Creditors.
• Convening and conducting meetings of the CoC, including presenting information necessary for creditors to make informed decisions.
• Inviting, evaluating, and presenting resolution plans to the CoC for approval, ensuring that any plan taken to vote meets the mandatory requirements under Section 30(2).
• Accessing all books of account, records, and information of the corporate debtor, and requiring cooperation from its personnel, promoters, and related parties.
• Appointing registered valuers and other professionals as needed to assist the resolution process.
• Filing applications before the Adjudicating Authority for avoidance of preferential, undervalued, fraudulent, or extortionate transactions where such transactions are identified.

Duties: The RP as Fiduciary

Section 25 of the IBC casts the RP in a fiduciary role, obligating the professional to preserve and protect the assets of the corporate debtor, including its business as a going concern. Beyond asset preservation, the RP's duties extend to representing and acting on behalf of the corporate debtor in legal proceedings, raising interim finance where authorised by the CoC, maintaining an updated list of claims, and ensuring strict compliance with the applicable law throughout the process. These duties have been the subject of legislative refinement in 2026, with amendments aimed at sharpening the standard of care expected of RPs and strengthening the mechanisms for holding them accountable where that standard is not met.

Relationship with the Committee of Creditors

While the RP manages the corporate debtor's day-to-day operations, commercial decision-making authority over the resolution rests with the Committee of Creditors, which votes on resolution plans, interim finance proposals, and related-party transactions above specified thresholds. The RP occupies a distinct position in this relationship: an independent professional who executes the process, exercises statutorily conferred powers, and advises the CoC, but who cannot substitute personal commercial judgment for the collective commercial wisdom of the creditors on matters reserved to them. This dual accountability to the Code and IBBI regulations on one hand, and to the CoC's commercial decisions on the other, defines the professional tightrope every RP walks.

Recent Regulatory Developments in 2026

The regulatory architecture governing RPs has continued to evolve through 2026. The IBBI notified the Insolvency Resolution Process for Corporate Persons (Third Amendment) Regulations, 2026, refining procedural requirements around the CoC's decision to confirm or replace the resolution professional, including the requirement for written consent from an incoming RP in the notified format. Separately, amendments to the Code itself in 2026 have reworked provisions concerning the duties of resolution professionals under Section 25, reflecting a continued regulatory focus on accountability.

The IBBI has also moved to strengthen the framework governing empanelment and rotation of insolvency professionals, publishing updated panels of Insolvency Professional Entities and individual Insolvency Professionals eligible for appointment as IRP, liquidator, RP, or Bankruptcy Trustee, prepared in line with its 2026 Recommendation Guidelines. Alongside this, the regulator has continued to focus on transparency and disclosure standards for RPs, with proposed reforms aimed at closer monitoring of RP conduct and independence, reflecting stakeholder concerns about the impartiality of professionals appointed in high-value or contentious insolvencies.

Accountability and Judicial Oversight

Because the RP wields extensive control over a corporate debtor's assets and operations, courts and tribunals have consistently emphasised that this authority must be exercised strictly within the four corners of the Code. The RP's actions — from claim admission or rejection to the conduct of CoC meetings to the presentation of resolution plans — are subject to scrutiny by the Adjudicating Authority and, on appeal, by the National Company Law Appellate Tribunal and the Supreme Court. Judicial pronouncements over the years have clarified the boundaries of RP discretion, particularly around claim verification, treatment of related-party creditors, and the limits of an RP's power to alter an approved resolution plan. This body of case law, read alongside the Code and IBBI regulations, forms the practical rulebook every practising RP must internalise.

Challenges Facing Resolution Professionals in Practice

• Balancing the going-concern management of the corporate debtor's business with the time-bound, litigation-adjacent demands of the CIRP.
• Managing information asymmetry, particularly where promoters or erstwhile management are uncooperative in handing over records.
• Navigating disputes among creditors, including between financial and operational creditors, without compromising the RP's own independence.
• Operating under compressed statutory timelines while ensuring that resolution plans meet all substantive and procedural requirements before being placed for CoC vote.
• Exposure to personal and professional liability for lapses, reinforcing the need for meticulous documentation of every decision taken during the process.

Conclusion

Section 23 of the IBC is a short provision, but it carries the entire operational weight of India's insolvency resolution framework. The Resolution Professional is simultaneously an administrator, a fiduciary, and an officer of the process, tasked with preserving enterprise value while shepherding a time-bound, creditor-driven resolution to its conclusion. As the IBBI continues to refine the regulatory framework governing RP conduct, appointment, and accountability, the profession's credibility and, by extension, the credibility of India's insolvency regime will continue to depend on RPs discharging this role with rigour, independence, and strict fidelity to the law.

Disclaimer: This article is for general informational purposes and does not constitute legal advice. Readers should refer to the Insolvency and Bankruptcy Code, 2016, applicable IBBI regulations, and professional advice for specific matters.