Issue and Surrender of Authorisation for Assignment and Disciplinary Proceedings

Reglation 10.     Temporary surrender

    (1) An insolvency professional agency shall inform the Board when it-
           (a) issues or renews an authorisation for assignment;
           (b) suspends or cancels an authorisation for assignment;
           (c) revokes the suspension of an authorisation for assignment; or
           (d) accepts the surrender of an authorisation for assignment,
                        within one working day of taking such action.

     (2) The Board shall take note of the information received under sub-regulation (1).
VL Note : –

Reglation 11.     Disciplinary proceedings

(1) Based on the findings of an inspection or investigation, or on material otherwise available on record, if the Board is of the prima facie opinion that sufficient cause exists to take actions permissible under section 220, it shall issue a show-cause notice to the insolvency professional.

(2) The show-cause notice shall be in writing, and shall state-
       a. the provisions of the Code under which it has been issued; 

       b. the details of the alleged facts; 

       c. the details of the evidence in support of the alleged facts; 

       d. the provisions of the Code, rules, regulations and guidelines thereunder allegedly violated, or the manner in which the public interest is allegedly affected;
       e. the actions or directions that the Board proposes to take or issue if the allegations are established;
       f. the manner in which the insolvency professional is required to respond to the show-cause notice;
       g. consequences of failure to respond to the show-cause notice; and
       h. procedure to be followed for disposal of the show-cause notice.

(3) The show-cause notice shall enclose copies of documents relied upon and extracts of relevant portions from the report of investigation or inspection, or other records.

(4) A show-cause notice issued shall be served on the insolvency professional in the following manner-
      (a) by sending it to the insolvency professional, at the address provided by him or provided by the insolvency professional agency with which he is enrolled , by registered post with acknowledgement due; or
      (b) by an appropriate electronic means to the email address of the insolvency professional, provided by him or provided by the insolvency professional agency with which he is enrolled.

(5) The Board shall constitute a Disciplinary Committee for disposal of the show-cause notice.

(6) The Disciplinary Committee shall endeavour to dispose of the show-cause notice within a period of six months of the assignment.

(7) The Disciplinary Committee shall dispose of the show-cause notice assigned under sub-regulation (5) by a reasoned order in adherence to principles of natural justice, and after considering the submissions, if any, made by the insolvency professional, the relevant material facts and circumstances, and the material on record.

(8) The order disposing of a show-cause notice may provide for-
      (a) no action;
      (b) warning;
      (ba) suspension or cancellation of authorisation for assignment;
      (c) any of the actions under section 220(2) to (4); or
      (d) a reference to the Board to take any action under section 220(5).

(9) The order passed under sub-regulation (7) shall not become effective until thirty days have elapsed from the date of issue of the order unless the Disciplinary Committee states otherwise in the order along with the reason for the same.

(10) The order passed under sub-regulation (7) shall be issued to the insolvency professional, with a copy issued to the insolvency professional agency with which he is enrolled immediately, and be published on the website of the Board.

VL Note : –