IBBI directs insolvency professionals to conduct due diligence and prevent misuse of the IBC framework for tax evasion or avoiding scrutiny, citing potential indicators.
Key Points
- IBBI has instructed insolvency professionals to perform due diligence to prevent misuse of the insolvency framework.
- The regulator noted that the IBC framework is being misused for purposes like mitigating tax liabilities and avoiding regulatory scrutiny.
- Insolvency Professionals must be vigilant for indicators of misuse and report suspicious cases to the Adjudicating Authority.
- The circular comes amidst cases like the Essel Group’s Subhash Chandra, highlighting concerns over personal guarantees and repayment plans.
New Delhi, Sep 9 (PTI) Regulator IBBI on…