IP Regulations gives power to the IBBI to issue SCN based on findings of an inspection

INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
(Disciplinary Committee)

01st December 2020

No. IBBI/DC/47/2020

In the matter of Mr. Sanjay Kumar Agarwal, Insolvency Professional (IP) under Regulation 11 of the Insolvency and Bankruptcy Board of India (Insolvency Professional) Regulations, 2016 read with Section 220 of the Insolvency and Bankruptcy Code, 2016 (Code).

Background

1. This Order disposes of the Show Cause Notice (SCN) No. IBBI/IP/SCN/2020/01/173 dated 14th February 2020, issued to Mr. Sanjay Kumar Agarwal, Draupadi Mansion, 3rd Floor, 11 Brabourne Road, Kolkata, West Bengal- 700001 who is a Professional Member of the Indian Institute of Insolvency Professionals of ICAI and an Insolvency Professional registered with the Insolvency and Bankruptcy Board of India (IBBI) with Registration No. IBBI/IPA-001/IP-P00062/2017-18/10140.

1.1 In exercise of its power under section 218 of the Code read with the IBBI (Insolvency Professional) Regulations, 2016, the IBBI has taken on record the First Information Report (bearing FIR Number- RC. 1(A)/2020-D) registered on 10th February 2020 with Central Bureau of Investigation (CBI), Anti-Corruption Bureau (ACB), Dhanbad, Addl. Superintendent of Police, CBI, ACB, Dhanbad arrested Mr. Agarwal on 11th February 2020 for demanding and accepting an illegal gratification of Rs. 5 Lakhs from complainant, Mr. Amit Sarawgi at office of M/s Khetsidas Machine Tool Worls Private Limited at Manjhiladih, Giridih. The case was registered under Section 7 of Prevention of Corruption Act, 1988 and Mr. Agarwal was produced by the CBI before the Court on 12th February 2020 and he was sent to judicial custody at district Jail, Dhanbad on 12th February 2020 for a period of 14 days. The Special Judge, CBI-cum-Additional Sessions Judge-XI, Dhanbad on request of CBI remanded Mr. Agarwal from judicial custody to custody of CBI for a period of 3 days i.e. 72 hours vide its Order dated 13th February 2020.

1.2 The IBBI on 14th February 2020 had issued the SCN to Mr. Sanjay Kumar Agarwal, based on examination of material available on record including the FIR registered with CBI and order of the Special Judge, CBI in respect of his role as interim resolution professional (IRP)/ resolution professional (RP) in corporate insolvency resolution process (CIRP) of Adi Ispat India Pvt Ltd. (CD). The SCN alleged contraventions of several provisions of the Insolvency and Bankruptcy Code, 2016 (Code), the IBBI (Insolvency Professionals) Regulations, 2016 (IP Regulations) and the Code of Conduct under regulation 7(2) thereof. Mr. Sanjay Kumar Agarwal replied to the SCN vide letter dated 3rd June, 2020 and also provided his additional reply vide email dated 6th August, 2020.

1.3 The IBBI referred the SCN, response of Mr. Sanjay Kumar Agarwal to the SCN, additional reply dated 6th August, 2020 and other material available on record to the Disciplinary Committee (DC) for disposal of the SCN in accordance with the Code and Regulations made thereunder. Mr. Sanjay Kumar Agarwal availed an opportunity of personal hearing (e-mode) before the DC on 11th August, 2020 when he reiterated the submissions made in his written reply and also made a voluntary undertaking. Thereafter, in support of his submissions made during the course of personal hearing he submitted the voluntary undertaking vide email dated 12th August 2020.

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