Circular No. IBBI/CIRP/87/2025 dated 04.11.2025
The Insolvency and Bankruptcy Board of India (IBBI) has issued an advisory to Insolvency Professionals (IPs) addressing situations where the assets of corporate debtors are attached by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act, 2002 (PMLA).
1. Proactive Action Required from Insolvency Professionals
IBBI has emphasised that IPs must take timely and proactive steps to seek release of such attached assets, as they are critical for running Corporate Insolvency Resolution Processes (CIRP), maximising value, and protecting stakeholder interests.
2. Introduction of Standard Undertaking for Faster Asset Release
To streamline the process, IBBI has introduced a standard undertaking format that IPs must submit along with applications filed before Special Courts.
This undertaking is expected to:
- Ensure uniformity in submissions
- Address recurring legal concerns
- Facilitate faster restitution of assets to the insolvency estate
- Reduce procedural delays
3. Objective Behind the Advisory
By standardising the approach, IBBI aims to:
- Improve efficiency in CIRP/Liquidation
- Prevent loss of asset value due to prolonged attachment
- Strengthen coordination between insolvency authorities and ED
- Support smoother resolution and liquidation outcomes
4. Key Takeaway
In cases where ED-attached properties belong to the corporate debtor, IPs must promptly initiate necessary legal steps and include the prescribed undertaking to expedite release of assets for insolvency proceedings.
