Section 3(1) in Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016
(1)An insolvency professional shall be eligible to be appointed as a resolution professional for a corporate insolvency resolution process of a corporate debtor if he, and all partners and directors of the insolvency professional entity of which he is a partner or director, are independent of the corporate debtor.Explanation. - A person shall be considered independent of the corporate debtor, if he:(a)is eligible to be appointed as an independent director on the board of the corporate debtor under section 149 of the Companies Act, 2013 (18 of 2013), where the corporate debtor is a company;(b)is not a related party of the corporate debtor; or(c)is not an employee or proprietor or a partner:(i)of a firm of auditors or [secretarial auditors] [Substituted 'company secretaries' by Notification No. IBBI/2017-18/GN/REG030, dated 27.3.2018 (w.e.f. 30.11.2016).] in practice or cost auditors of the corporate debtor; or(ii)of a legal or a consulting firm, that has or had any transaction with the corporate debtor amounting to [five per cent] [Substituted 'ten per cent' by Notification No. IBBI/2018-19/GN/REG031, dated 3.7.2018 (w.e.f 30.11.2016).] or more of the gross turnover of such firm, in the last three financial years.
