ORDER

The petitioner herein is a Resolution Professional, and the Insolvency and Bankruptcy Board of India (in short IBBI) vide its proceedings dated 03.07.2023 issued a show-cause notice on him under Section 219 of the Insolvency and Bankruptcy Code, 2016 (in short IBC), r/w Regulations 11 and 12 of IBBI (Inspection and Investigation) Regulations, 2017. By virtue of this show-cause notice, the Authorization For Assignment (AFA) of the Resolution Professional concerned will stand automatically suspended under Regulation 23A of the Model Bye-Laws and Governing Board of Insolvency

Professional Agencies Regulations, 2016

1.2. The pointed allegation made against the petitioner in the show cause notice is that the petitioner was appointed as the liquidator for M/s.Jeypore Sugar Limited (under liquidation), and while discharging his responsibilities under Sec.230 of the Companies Act, he shared the details of the valuation report of the assets of the company with all the scheme proponents, as a result of which all of them quoted the same price.

1.3.The petitioner has given his reply to the show-cause notice and it is under enquiry. In this petition, the petitioner challenges the show-cause notice.

2.1 The case of the petitioner is that:

a) On 25.02.2019, a Corporate Insolvency Resolution Process (CIRP) of

Jeypore Sugar Company Ltd. commenced, and the petitioner was appointed as the Resolution Professional by the Adjudicating

Authority, which by definition is the NCLT.

b) On 29.05.2020, the Adjudicating Authority decided that CIRP has failed, and initiated the liquidation process of the corporate-debtor, and the petitioner was appointed as the liquidator.

c) Subsequently, IDBI bank, one of the financial creditors of the corporate debtor, had moved IA 815/IB/2020 in CP 1307/IB/2018 before the Adjudicating Authority, seeking the replacement of the petitioner as the liquidator on the ground that the petitioner has acted against the interest of the corporate debtor (CD) by sharing the valuation report with the prospective scheme proponents. While contesting the said application, the petitioner did admit that he had shared the valuation report of the corporate debtor with the prospective scheme proponents. On 01.07.2022, the Adjudicating Authority condemned the said act of the petitioner and proceeded to pass an Order and removed the petitioner as the liquidator.

d) Subsequently, on 01.09.2022, one Mr. Anil Kumar, a Technical

Member of the NCLT (3rd respondent herein), had filed two complaints, one with the Indian Institute of Insolvency professionals of the Institute of Chartered Accountants of India(IIIP/ICAI), and the other with the IBBI. In his complaint, the 3rd respondent had alleged that the petitioner, after he was removed as the liquidator of the corporate debtor, was defiling the former's reputation in the profession by concocting stories of corruption. The 3rd Respondent had also alleged that the Petitioner had violated Clause 21 of the Code of

Conduct specified in the First Schedule to the IBBI (Insolvency Professionals) Regulations, 2016, which mandates the Insolvency Professional to ensure confidentiality of the information relating to the liquidation process.

e) This complaint however, was rejected by the IIIP on the ground that it does not fall within the purview of the IBC. But not the IBBI. On 03.07.2023, the IBBI issued a show cause notice to the petitioner alleging that he had violated Regulations 34(2) and 34(5) of the Liquidation Regulations, which mandate that the asset memorandum must be kept confidential during the process of liquidation, that by leaking the same to the prospective scheme proponents had resulted in all the prospective scheme proponents quoting identical price along the valuation report. The IBBI asked the Petitioner to show cause as to why disciplinary action should not be taken for violating Secs. 35(1)(d), 208(2)(a), 208(2)(e) of the Code, Regulation 34(5) of the Liquidation Regulations, Regulations 7(2)(a)