# Sundaresh Bhat vs. Insolvency and Bankruptcy Board of India

> HC judgment dated 2024-05-27. Citation: TCN-2024-HC-00084. The Petitioner, Sundaresh Bhat, filed a Writ Petition challenging an order dated 28.09.2022 issued…

- **Court:** HC
- **Order date:** 27 May 2024
- **Citation:** TCN-2024-HC-00084
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/sundaresh-bhat-vs-insolvency-and-bankruptcy-board-of-india-9549bd36

## Summary

### Background

The Petitioner, Sundaresh Bhat, filed a Writ Petition challenging an order dated 28.09.2022 issued by the Disciplinary Committee of the Insolvency and Bankruptcy Board of India (IBBI). The IBBI order suspended the Petitioner's registration for two years. The case arises from the Petitioner's role as the Interim Resolution Professional and later as the Liquidator for ABG Shipyard Limited, a Corporate Debtor undergoing Corporate Insolvency Resolution Process (CIRP) and subsequent liquidation. The IBBI initiated disciplinary action based on alleged contraventions of the Insolvency and Bankruptcy Code (IBC) and related regulations.

## Facts

ABG Shipyard Limited was in the business of shipbuilding. ICICI Bank filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 ('the IBC'), leading to the initiation of the Corporate Insolvency Resolution Process (CIRP). The Petitioner, Sundaresh Bhat, was appointed as the Interim Resolution Professional and later as the Liquidator. The NCLT, Ahmedabad, directed the Corporate Debtor to undergo liquidation under Section 33(2) of the IBC. The IBBI issued a Show Cause Notice to the Petitioner based on a draft inspection report, alleging several contraventions. These included influencing registered valuers, prescribing non-refundable participation fees for auction bidders, appointing unregistered valuers, and paying excess fees to BDO Restructuring

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## Issues and analysis

### Issue 1: Whether the Petitioner contravened regulations by prescribing non-refundable participation fees for …

**Ratio:** The imposition of non-refundable participation fees is evaluated against the principle of

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**Reasoning:** The court noted that the proviso prohibiting non-refundable fees was not in force when

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**Interpretation:** The court interpreted the regulations in light of their temporal application,

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**Application:** The court applied this principle to the facts, finding that since the

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## Parties

- **Judges:** Subramonium…
- **Appellants:** Sundaresh…
- **Respondents:** ABG Shipyard…; Insolvency and…
- **Other parties:** 7th Edition…; Conflict of…; +10 more

## Timeline

- **2016-01-01 — Enactment…**: The Insolvency and…
- **2019-04-25 — NCLT Ord…**: NCLT Ahmedabad directed that the Corporate Debtor shall undergo liquidation under Section…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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