September 8, 2021
Ms. Agarwal is a Gurugram-based IP and a Director of ASC Group.
Could you tell us a little about your educational and professional background?
I have done economics honours and political science honours, and then I did my MA in economics. I have also done an MBA.
Initially, I was an entrepreneur, I have worked as a jewellery designer. But for the better part of my professional life, I think more than 17 years now, I’ve been a management consultant.
What made you turn to insolvency?
I was a financial and management consultant, and I come from a consulting firm which started as a chartered accountancy company. So, when the IBC was launched, it was a natural progression for any person who had been there in the restructuring ecosystem, or had been a financial advisor. We are working day in and day out with organizations on two fronts — how you can earn more money, and there are only two ways you can do that. One is you cut down your costs, and two is you increase your profits. Since we were working in these two areas for most of the MNCs and Indian clients, it was a very natural progression for us as an organization to go into this insolvency ecosystem. We had the ready-made capacity to work as insolvency professionals, and to work as an insolvency professional entity. We had everything available in-house to run through these the IR process or the liquidation process. Whether it was the compliance or the financial assessment of companies.
That makes sense. Can I ask how many assignments have you handled and in which sectors or industries?
Right now, I’m handling four assignments. One is a paper manufacturing unit in which I got the resolution plans twice; but somehow, they could not get through in the first instance because the NCLT did not approve the plan and later on, the circumstances changed with the RA, so he withdrew.
I have also been handling two real estate cases, out of which one is a branded hotel. The second is a real estate project which has many homebuyers involved. Then there were one or two cases in which a settlement happened. One was Pan Realtors, in which I was appointed by the NCLT. The fourth is Jassum Propcon, which again is a real estate case in which I have been appointed as the liquidator.
You must have qualified as an IP quite early on.
Yes, sure. I was there right from the very beginning. But passing the exam and the registration process took a little time, so my registration number is about 213 I think. I had qualified the exam by March, but my registration came in about May.
How has your experience been over the last five years – from the early days of IBC till now?
When the IBC came into being, there was not just one type of issue. We had to start from the word insolvency. People didn’t know this word, even corporate debtors themselves had not even heard of insolvency. One had always heard about the bankruptcies, the BIFR and so on. But people were not very familiar with ‘insolvency’. And not just corporate debtors, even the lenders bankers did not have this concept of either insolvency, or resolution. We had to educate people on these two words and make them understand that it was not a rocket science or something out of the blue. That it was a well-established term and concept worldwide, and that in fact we had been very late in bringing in this kind of statute. So, that was one part.
Then the second part was, there were many legal issues that were yet to be settled, many lacunas and the law was silent on many things. As insolvency professionals, we had to work very diligently on the decisions we took, to ensure they would not be challenged later when the provisions were clarified. So, we did many things on which the law was not clear, but we have been fortunate enough that none of our work or decisions were ever challenged. In fact, I had a few landmark judgments in my name in the very beginning, which kind of established our name as an insolvency professional entity. That has been really a journey.
Now most of the things are settled. But I think there is a fun element in things not being explicitly clear because then you need to think out of the box, take those risks, and when those risks come out fruitfully in your favour, then that establishes you as a professional.
An IP has to deal with, and direct, many stakeholder groups – employees, promoters, workmen, creditors etc. Also, it’d be reasonable to assume that these groups, and the industry in general, tend to be quite male dominated. Therefore, would you say being a woman in a position of authority as an IP has affected your experience?
I think generally, women get this treatment when they are in a commanding position. Not many people take kindly to being commanded by a woman. I remember one instance categorically. In my first case, which was Shri Bhawani Paper Mill, I went to the factory premises. I held a meeting there of all the people available like the CEO, the CFO, the promoters, the bank representatives, my team and all kinds of stakeholders. The CEO was an ex-army person, and I’m proud to say he is still with me after almost three years. But initially, he was not thrilled with the situation. That his company had gone into a resolution process, that some people had come out of the blue to take control, and that he was being told to do this and that. Initially, he was a little reluctant, and in fact we had a sort of confrontation as well once or twice. But then he saw me working, dealing with the people, running the process; and within three or four months, he became thoroughly cordial about taking directions from me and cooperating with me and my team. After three years, he’s still as cordial and respectful as one should be.
We live in a patriarchal society, and I’m sure businesses also gets affected by that, but as long as people can see that you are not just a man or a woman but a professional, and you are doing your work independently and diligently, they respect you. There was another incident, and these are the only two incidents where I have felt this difference. I have been a part of the committees on IBC of many trade bodies like CII, ASSOCHAM, PhD etc. Usually, I was either the only woman, or there would be one or two more as an assistant to somebody. In the very beginning, not many women were in commanding positions or on panels or in committees, so sometimes I was the only woman on the table. So one time this RP asked me, ‘don’t you feel it’s quite a daring kind of a profession for you?’ This was the time when people were abducted, were kidnapped. RPs were being threatened by labour, they were being threatened by corporate debtors, these were those times. So, he asked me, ‘don’t you get scared of being in this profession?’ I said, why should only I be afraid? I said, anything can happen to anyone, whether it is a man or a woman; we are just professionals. I was a little disappointed because a fellow RP was asking me this question.
So other than that, I would say I have never faced any bias. Because at the end of the day, it depends on you. It depends on how you conduct yourself and how you carry yourself.
That is good to hear, and I hope it reflects the experience of all IPs.
You touched upon how some sensational aspects of an IP’s work get highlighted in the media. Are there other aspects of the job, which are not as well known?
As insolvency professionals, very naturally we do not always know everything. It was not an established profession in India, and there were so many things which we had to deliver while we were learning and absorbing them. That is why, for an insolvency professional (and for that matter, for any professional) it is important to know your job, and to know how to get it done. When you are at a higher level of management, you’re not supposed to know everything but if a situation arises, you should know how to deal with it. And who can get it done. Since I have been at the very highest levels in my organization, that understanding has always been there. That is also the reason why IPs can hire a range of other professionals. Whether you are a chartered accountant, a lawyer or a CS, you will only know one aspect of the whole problem. But as an IP, your view should not be restricted to that one profession – your view needs to be a 360º view from a management perspective; and I think that helped me a lot because I have been a management consultant, so I always had that 360º view of things. For example, when I was appointed as an RP of a manufacturing unit or a paper mill, I wasn’t very knowledgeable about the industry. But it just took me 15 days to a month to understand the whole business. It was just a matter of some Google searches, talking to some professionals, sitting with some ex-employees or the corporate data because it’s just not rocket science. At the end of the day, it’s just a business where the dynamics are a little different from any other business. I think as RPs, we require that kind of talent.
Lastly, what would your advice be to professionals who want to become an IP?
I think maturity and awareness is something which you have to bring in with you. There is no time for you to attain that while you are an RP. A very broad approach or a big picture perspective is required because a lot of communication skills and interpersonal skills are the most important thing for an RP; because they have to work with opposing stakeholders where everyone has their own vested interest. The RP is the only person who is independent. So, you really need robust interpersonal skills, a sound procedural understanding of things, and maturity, for sure. You cannot do without that.
And your EQ because if you are a soft-hearted person, you can’t handle the issues. Then you will not be able to work because there are people who are homebuyers, who would come and abuse you to your face. You may not have done anything wrong, but they are desperate and have tried everything, and then the CIRP happens. In the first six months to a year they only abuse you and nothing else. You really, truly need a thick skin to withstand all that. You need to be emotionally resilient to thrive in this profession.
(This interview was conducted by Adv. Parth Indalkar and has been edited and condensed for clarity.)
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