The Bombay High Court has set aside an Insolvency and Bankruptcy Board of India (IBBI) disciplinary order suspending an insolvency professional for three months, holding that the show cause notice was based on matters extraneous to the investigation and that relevant material was ignored while imposing the penalty.
The Bench of Justice Manish Pitale and Justice Shreeram V. Shirsat observed that IBBI must be more circumspect while issuing show cause notices because the initiation of disciplinary proceedings itself results in the suspension of an insolvency professional’s authorisation to accept assignments.
The bench was considering writ petitions filed by insolvency professional and Edelweiss Asset Reconstruction Company Limited against…