IBBI imposes Penalty of Rs. 5 Lakhs on RP for Professional Misconduct of Non-mentioning of Clearing of Pre-CIRP dues to CoC [Read Order]

Disciplinary Committee of the Insolvency and Bankruptcy Board of India (IBBI) comprising Whole Time Member Sudhaker Shukla has recently imposed a monetary penalty on Insolvency/Resolution Professional(RP) Anil Mehta, a fine of Rs. 5,00,000/- for non mentioning of consideration of agenda of clearing Pre-CIRP(Corporate Insolvency Resolution Process) dues amounting to professional misconduct.

The Board, in exercise of the powers conferred to it under section 218 of the Code read with the Inspection Regulations, appointed an Inspecting Authority (IA) to conduct the inspection of Mr. Anil Mehta. . Based on the material available on record including the Inspection Report, the Board issued the SCN to Mr. Anil Mehta on 07.09.2022. The SCN alleged contraventions of many provisions  of IBBI (Insolvency Professional) Regulations, 2017 (IP Regulations) read with Clause 1, 2, 3, 14 and 15 of the Code of Conduct as specified in the First Schedule of the IP Regulations. Mr. Anil Mehta replied to the SCN on 22.09.2022.

It was observed that he made payment to the tune of Rs. 3.89 crore for expenses such as internet charges, salary dues, fuel expenses, rent and certain payment to contractors, pertaining to the period prior to CIRP commencement date, in breach of the statutory moratorium.

The DC observed that the payment of pre-CIRP dues of one set of creditors tantamount to preferential treatment to certain creditors.

It was also observed that the RP failed to obtain the Audit Report from an external agency appointed by him.

The Disciplinary Committee, thereby imposed a penalty on Mr. Anil Mehta of Rs. five lakhs and directs him to deposit the penalty amount directly to the Consolidated Fund of India (CFI).

To Read the full text of the Order CLICK HERE

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