2024 (7) TMI 934 - HC - Insolvency and Bankruptcy

Composition of Disciplinary Committee - respondents accepts notice and seeks time to file a response - HELD THAT - Issue notice. List on 03.07.2024 before Roster Bench.

Summary

Issues Involved:
1. Validity of the Impugned Order dated 16.05.2024 suspending the registration of the Petitioner.
2. Composition of the Disciplinary Committee under the Insolvency and Bankruptcy Board of India.
3. Statutory period for completion of proceedings in response to show cause notice.
4. Delay in filing the present petition.
5. Adjudication of legal grounds and reservation of judgment by the Roster Bench.

Analysis:

1. The petitioner sought to quash the Impugned Order suspending their registration as an Insolvency Professional for one year. The petitioner also requested to restrain the Respondent from taking coercive action or to declare the suspension satisfied due to prior suspension. Additionally, the petitioner sought interim reliefs and any other suitable orders. The petitioner's counsel argued irregularities in the Impugned Order, including the composition of the Disciplinary Committee and the statutory period for proceedings.

2. The petitioner contended that the Disciplinary Committee, consisting of a single member, violated Section 220(1) of the Insolvency and Bankruptcy Code. The section mandates that the committee should comprise whole-time members of the Board only. This non-compliance was raised as a ground for challenging the Impugned Order's validity.

3. Another irregularity highlighted was the alleged delay in completing proceedings within the statutory period of 34 days as per Rule 13 of the Insolvency and Bankruptcy Board of India Regulations. The petitioner argued that the delay was not solely due to their conduct, implying shared responsibility for the delay.

4. The Respondent argued that the petition was delayed by four weeks and contested the mandatory nature of the composition rule for the Disciplinary Committee. It was asserted that the delay in the statutory period could not be solely attributed to the Respondent, suggesting the petitioner's conduct contributed to the delay.

5. The Roster Bench reserved judgment on the legal grounds raised in the case. Notice was issued, and the respondents were given time to file a response and a counter affidavit. The case was scheduled for listing before the Roster Bench on a specific date for further proceedings and adjudication of the legal issues raised.

This detailed analysis encapsulates the key arguments, legal provisions, and procedural steps involved in the judgment, providing a comprehensive overview of the case's complexities and implications.