Delegating Control to Suspended Directors Without Approval Leads to Disciplinary Action; Failure to Take Custody of Assets During CIRP Results in One-Year Suspension; No Exception for Urgency: Delegation Without CoC Consent Breaches Insolvency Law; Fresh GST Registration Mandatory During CIRP, Regardless of Business Activity; Allowing Suspended Management to Run Operations Violates IRP/RP Obligations; Non-Compliance With GST Laws During CIRP Triggers Regulatory Sanctions.
The Disciplinary Committee of the Insolvency and Bankruptcy Board of India examined allegations against an Insolvency Professional arising from a CIRP where he delegated day-to-day management and overall operations of the corporate debtor to a director of the suspended board without prior approval or subsequent ratification by the Committee of Creditors. The Committee found that such delegation violated statutory duties requiring the IRP/RP to assume control, preserve assets, and manage operations, and that reliance on informal undertakings and claims of urgency did not justify bypassing due diligence or disclosure to the CoC. The Committee also held that the IRP/RP failed to comply with GST laws by not obtaining a fresh GST registration for the corporate debtor during CIRP and by allowing the suspended management to file returns, contrary to statutory obligations and CBIC guidance. Concluding that these lapses reflected negligence and abdication of responsibility, the Committee upheld contraventions of multiple provisions of the Code and the Code of Conduct, and imposed a one-year suspension of registration, effective after 30 days, with consequential directions to stakeholders and regulators.
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
(Disciplinary Committee)
Order No. IBBI/DC/302/2026 |Dated: 13 January 2026
This Order disposes of the Show Cause Notice (SCN) No. COMP-11011/79/2024-IBBI/937/368 dated 10.03.2025 issued to Mr. R. Thamodharan, who is an Insolvency Professional (IP) registered with the Insolvency and Bankruptcy Board of India (IBBI/Board) having Registration No. IBBI/IPA-001/IP-P-02292/2021-2022/13592 and a Professional Member of the Indian Institute of Insolvency Professionals of ICAI.
1. Background
1.1 The Corporate Insolvency Resolution Process (CIRP) of Meenakshi Cargo Forwarders Private Limited (Corporate Debtor/CD) was initiated by an order dated 10.07.2023 by the NCLT, Chennai Bench (AA), in an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (Code) by M/s. Index Logistics Private Limited, wherein Mr. R. Thamodharan was appointed as the Interim Resolution Professional (IRP) and later confirmed as Resolution Professional (RP) of the CD.
1.2 Based on the complaint dated 04.08.2024 received by the Board and the materials available on record, it was decided to examine the issues, inter-alia, failure of Mr. R. Thamodharan to take control and custody of the assets of the CD and failure to comply with GST Laws. The Board vide e-mail dated 29.l0.2024 sought reply of Mr. R. Thamodharan’s on these issues and Mr. R. Thamodharan’s reply thereof was received on 01.11.2024.
1.3 The Board on the basis of such examination and materials available on record, formed a prima facie view that Mr. R. Thamodharan had contravened provisions of the Code and the Regulations made thereunder and accordingly issued the SCN to Mr. R. Thamodharan on 10.03.2025. The reply of Mr. R. Thamodharan to the SCN was received by the Board on 24.03.2025.
1.4 The SCN, the reply of Mr. R. Thamodharan to the SCN and other materials available on record were referred to this Disciplinary Committee (DC). Mr. R. Thamodharan availed an opportunity of personal hearing before the DC on 14.10.2025 through virtual mode.
2. Alleged Contraventions, Submissions of Mr. R. Thamodharan, and Findings of the DC.
The contraventions alleged in the SCN, oral and written submissions by Mr. R. Thamodharan and analysis and findings of the DC are summarized in the following paragraphs.
2.1 Failure to take control and custody of the assets of the CD.
2.1.1 Section 17 (1) of the Code provides that from the date of appointment of the IRP, the management of the affairs of the CD shall vest in the IRP and the powers of the board of directors of the CD shall stand suspended and be exercised by the IRP. Section 18(d) of the Code requires the IRP to monitor the assets of the CD and manage its operations until a RP is appointed by the Committee of Creditors (CoC). Section 25(1) of the Code requires the RP to preserve and protect the assets of the CD, including the continued business operations of the CD. Further, Section 28(1)(h) requires the RP to take prior approval of the CoC to delegate its authority to any other person.
2.1.2 The CIRP of the CD commenced on 10.07.2023. It was observed from the minutes of the 1st CoC meeting held on 08.08.2023 that Mr. R. Thamodharan informed the CoC about the visit of his representative to the registered office of the CD on 12.07.2023 and pasting of notice therein informing initiation of the CIRP.
2.1.3 It was further observed from Mr. R. Thamodharan’s reply to the Board that he had delegated control and management of the operations of the CD to Mr. A. Sureshkumar, one of the directors of the suspended board of the CD to continue the business operations of the CD after taking an undertaking dated 13.07.2023 from him. It was, however, observed that delegation of the management of the CD was done without taking prior approval of the CoC, as was required under Section 28(1)(h) of the Code.
2.1.4 It was further noted from Mr. R. Thamodharan’s reply to the Board that he had visited the registered office of the CD on 24.07.2023. In the 1st meeting of the CoC held on 08.08.2023, Mr. R. Thamodharan had informed that he could not get any satisfactory reply from the suspended management on the profits generated by the CD during the one-month CIRP period (i.e. the period when the operations were being managed by the suspended management) and on the aspect of amount realised from customers during this period. This indicates lack of awareness on the part of Mr. R. Thamodharan, about the operations of the CD and his failure to take control and custody of the CD and manage its operations.
2.1.5 In his reply to the Board, Mr. R. Thamodharan stated that it is usual practice to give back control of the CD to the suspended management to run the business after taking undertaking from the suspended management. In terms of Section 18(d) of the Code, it is the duty of the IRP to monitor the assets of the CD and manage its operations until a resolution professional is appointed. However, it was seen that that Mr. R. Thamodharan had delegated the management of the operations of the CD to the suspended management without the approval of the CoC. Mr. R. Thamodharan’s reply stating that the handing over the operations of the CD to suspended management was usual practice shows casual and negligent approach of Mr. R. Thamodharan.
2.1.6 Thus, the Board, was of the prima-facie view that Mr. R. Thamodharan had contravened Sections 17(1), 18(d), 25(1) and 28(l)(h) of the Code read with Clause 14 of Code of Conduct specified in the first schedule of the IP Regulations.
Submissions by Mr. R. Thamodharan.
2.1.7 Mr. R. Thamodharan submitted that he had assumed full control of the CD immediately upon commencement of the CIRP. He further submitted that in the 1st CoC meeting, the director of the suspended board of the CD stated that if the CD was allowed to operate under his control, he would be able to improve operations and meet commitments, and this very statement evidenced that Mr. R. Thamodharan had already taken charge of the CD, by which the suspended board was aggrieved. Further, in the 1st CoC Meeting, Mr. R. Thamodharan presented the monthly budget for continuing the business of the CD and engaged in a detailed discussion with the CoC regarding the same and presented a detailed note on the going concern status of the CD and apprised the CoC of the various income and expense heads, seeking their opinion on continuing operations.
2.1.8 Mr. R. Thamodharan further submitted with respect to the undertaking dated 13.07.2023, that the same was obtained not as a transfer of management but purely as a risk mitigation measure. On the CIRP commencement date, the CD was a going concern with certain ongoing contracts. Mr. R. Thamodharan’s team had immediately visited IDFC First Bank to intimate the commencement of the CIRP and to seek authority to operate the bank account. However, the Bank refused to permit Mr. R. Thamodharan to operate the account and by 31.08.2023, the overdraft account was rendered non-operational. Mr. R. Thamodharan approached the Hon’ble NCLT through IA(IBC)/166(CHE)/2024 seeking directions to operate the account, which was allowed only by an order dated 07.10.2024 of the AA, in favour of the successor liquidator.
2.1.9 Mr. R. Thamodharan submitted that the CD was engaged in transporting shrimp babies through airlines, wherein the shrimp were packed in special containers designed to ensure their survival for approximately 24 hours. Accordingly, it was essential that delivery to the buying customers be completed within this 24-hour period to avoid any loss. The director of the suspended board, Mr. Suresh Kumar, informed him, that the bookings for such transportation had been accepted by the selling customers prior to the commencement of the CIRP, and non-implementation of these confirmed bookings would have resulted in significant financial loss to the corporate debtor, as the shrimp babies would not survive beyond 24 hours, thereby leading to the damage claims from the customers. Accordingly, an undertaking was obtained from the suspended management, and all payments relating to these transactions were made only after his approval.
2.1.10 Mr. R. Thamodharan further submitted that the aforesaid permission granted to the ex-management was limited to the execution of the bookings already accepted by the suspended management prior to the commencement of the CIRP. If these bookings were not honoured, the CD would have been liable to pay substantial compensation for the loss of consignments already booked. Therefore, in this emergency situation, Mr. R. Thamodharan, being the IRP permitted a limited continuation of the business operations as a special case, under his direct supervision and of his representatives, since at that time the CoC had not yet been constituted, which was subsequently formed on 31.07.2023. Hence, in these extraordinary circumstances, the IRP was required to take immediate decisions to prevent heavy losses and safeguard the interests of the corporate debtor.
2.1.11 Mr. R. Thamodharan further submitted that in circumstances of pending contracts and prior to constitution of the CoC, he had no alternative but to authorise the director of the suspended board to honour certain pending contractual commitments in order to preserve the CD’s going concern status. In order to safeguard against potential misuse or liability arising out of such authorisation, an indemnity and undertaking dated 13.07.2023 was obtained from the director of the suspended board which was a prudent and standard practice in such situations. This limited authorisation related only to the execution of contracts that were already underway before the CIRP commencement and did not amount to delegation of the management. On the contrary, failure to honour these commitments would have resulted in the abrupt cessation of operations, defeating the Code’s objective of maintaining the CD as a going concern.
2.1.12 Mr. R. Thamodharan further submitted that there exists a clear distinction between “management” and “operations.” While the management of the CD vests with the IRP/RP under Section 17(1) of the Code, the day-to-day operations may be carried out by authorised personnel under the IRP/RP’s direction. Accordingly, while Mr. R. Thamodharan, in his capacity as the IRP retained full management control, limited authorisation was given to the directors of the suspended board of the CD to execute specific operational functions, as per the IRP’s directions.
2.1.13 To support his submissions, Mr. R. Thamodharan placed reliance on the Hon’ble NCLAT’s judgement in Mr. Mukund Choudhary v. Mr. Subhash Kumar Kundra, Company Appeal (AT)(Insolvency) No. 452 of 2021, wherein it was held that initiation of CIRP does not release the directors of the corporate debtor from their duties but only suspends their powers, with the RP managing the company. In line with this legal position, the assistance of the directors of the suspended board of the CD in completing pending works under the IRP’s supervision was in conformity with the Code. Mr. R. Thamodharan further submitted that the transactions authorised by him were transparently presented before the CoC in its first meeting and a notice dated 31.08.2023 was issued to the directors of the suspended board seeking details of efficiency and profitability of the transactions.
Analysis and Findings of the DC.
2.1.14 Section 17(1) of the Code provides that from the date of his appointment, the Interim Resolution Professional is vested with the management of affairs of the corporate debtor and the powers of the board of directors or the partners of the Corporate Debtor, as the case may be, stands suspended and is exercised by the interim resolution professional. The said provision is reproduced as hereunder:
“17. Management of affairs of corporate debtor by interim resolution professional. – (1) From the date of appointment of the interim resolution professional, –
(a) the management of the affairs of the corporate debtor shall vest in the interim resolution professional; (b) the powers of the board of directors or the partners of the corporate debtor, as the case may be, shall stand suspended and be exercised by the interim resolution professional;
………”
2.1.15 Further in terms of Section 18(d) of the Code, it is the duty of the interim resolution professional to monitor the assets of the corporate debtor and manage its operations until a resolution professional is appointed by the committee of creditors. The said provision is as follows:
“18. Duties of interim resolution professional. – The interim resolution professional shall perform the following duties, namely: –
(a)……
……
(d) monitor the assets of the corporate debtor and manage its operations until a resolution professional is appointed by the committee of creditors;
………”
2.1.16 The DC notes that Mr. R. Thamodharan submitted that the delegation was limited to the authorisation related only to the execution of the contracts that were already underway before the commencement of the CIRP and it did not amount to delegation of management of the affairs of the CD. However, he did not provide any document or evidence to establish the existence of any such prior contracts which required their execution post CIRP. The material available on record and the submissions of Mr. R. Thamodharan reflects that he solely relied on the statements of the director of the suspended management of the CD. Further, such submission of Mr. R. Thamodharan regarding execution of previous contracts seems contrary to his own submission before the DC that there was no business of the CD post commencement of the CIRP.
2.1.17 Further, the DC has also perused the undertaking from Mr. Arunachalam Sureshkumar, director of the suspended board of the CD wherein it was mentioned that he was working as Chief Executive Officer with the authority delegated by Mr. R. Thamodharan. The relevant excerpts from the undertaking is as follows:
“I Shri, Arunachalam Sureshkumar, Managing Director, hereby declare and confirm that the CD M/s. Meenakshi Cargo Forwarders P Ltd., has been operating properly.
The day-to-day management of the CD, with regard to, purchase, sales, administration and overall management, under the CIRP proceedings continue to be under the delegated control and direction of Shri. Arunachalam Sureshkumar, Managing Director and I am fully aware of the delegated responsibility.
I, Shri. Arunachalam Sureshkumar, Managing Director have been discharging my duties with full responsibility as the Chief Executive Officer of the CD with the authority delegated by the Interim Resolution Professional from the date of commencement of the CIRP proceedings, and I am continuing to discharge my duties with overall full responsibility for all the operations of the company, including that of protecting the current assets and fixed assets, of the Company and accounting for the. liabilities of the company correctly and appropriately.
Accordingly, I, Shri. Arunachalam Sureshkumar, Managing Director, on my behalf and on behalf of the Corporate Debtor, hereby further declare that I, Shri. Arunachalam Sureshkumar, Managing Director along with this Corporate Debtor are the only persons responsible for all the consequences of the operations of the company to bring the CD to a “going concern” status and for protecting and preserving the value of the property of the Corporate Debtor during the CIRP proceedings”
2.1.18 The DC observes that as per the aforesaid undertaking, Mr. Arunachalam Sureshkumar was vested with full responsibility for overall operations of the CD, including the protection of the assets of the CD, and the delegated control and direction of the day-to-day management of the CD. There is no mention of any limitation to this delegation, as was claimed by Mr. R. Thamodharan in his submissions. Accordingly, the material available on record establishes that Mr. R. Thamodharan allowed the delegation of his duty of overall management of affairs of corporate debtor to the director of the suspended board of the CD.
2.1.19 Section 28(1)(h) of the Code mandates the resolution professional to take prior approval of committee of creditors while delegating its authority to any person. The relevant provision is as follows:
“28. Approval of committee of creditors for certain actions. – (1) Notwithstanding anything contained in any other law for the time being in force, the resolution professional, during the corporate insolvency resolution process, shall not take any of the following actions without the prior approval of the committee of creditors namely: –
(a)….
(h) delegate its authority to any other person;
……”
2.1.20 Accordingly, before delegating his authority to Mr. Arunachalam Sureshkumar, it was incumbent on Mr. R. Thamodharan to seek approval of the committee of creditors. Even considering the contention of Mr. R. Thamodharan that the nature of business of CD was time-sensitive and required urgent actions even before the constitution of the CoC to avoid any potential liability on the CD, it was incumbent upon him to apprise the CoC regarding delegation of certain functions to Mr. A. Sureshkumar, immediately when it was formed and seek their ratification on such delegation. However, in none of the CoC meetings, Mr. R. Thamodharan had put up this issue of delegation of his responsibilities to the director of the suspended board of the CD.
2.1.21 The DC also observes that the CIRP of the CD commenced on 10.07.2023 and as submitted by Mr. R. Thamodharan in the 1st CoC meeting, his representative visited the registered office of the CD on 12.07.2023. It is noteworthy that the date of undertaking executed by Mr. A. Sureshkumar was 13.07.2023, i.e. only a day after when the visit was made by staff of Mr. R. Thamodharan to the registered office of CD. The chronology of these events reflects that Mr. R. Thamodharan acted hastily in delegating the functions to Mr. A. Sureshkumar without carrying out adequate due diligence regarding the need and necessity of such delegation.
2.1.22 Furter, the DC also notes that in the 1st CoC meeting held on 08.08.203, Mr. R. Thamodharan did not inform the CoC that on 17.07.2023, he had taken an undertaking from the director of the suspended board Mr. A. Sureshkumar and delegated his authority to him to run the business operations of the CD. Although Mr. R. Thamodharan asserted that he had transparently disclosed to the CoC in its 1st meeting the transactions carried out by him, the DC observes that there was no reference of the undertaking given by Mr. A. Sureshkumar and the delegation of functions to him by Mr. R. Thamodharan, in the minutes of the 1st CoC meeting. It is further observed that the first CoC meeting was conducted on 08.08.2023, i.e., nearly one month after the said delegation of the authority. The DC notes that neither Mr. R. Thamodharan nor Mr. A. Sureshkumar (who was also present in the meeting), apprised the CoC as to what business operations were conducted during the period from 17.07.2023 to 08.08.2023 and what was the future scope of the business of the CD. In the minutes of the 1st CoC it was mentioned that the director of the suspended board had submitted that if the company is allowed to continue to operate under his control, he will be able to improve the operations and meet all the commitments out of the operations. But nothing was mentioned in the said minutes about what action was taken by Mr. R. Thamodharan during 17.07.2023 to 08.08.2023. Being a qualified professional, Mr. R. Thamodharan, should have disclosed in the 1st CoC meeting about delegating his authority to Mr. A. Sureshkumar and should have sought ratification for the same from the CoC. He should also have disclosed to the CoC members what business operation were carried out during the period from 17.07.2023 to 08.08.2023.
2.1.23 The DC further notes the submission of Mr. R. Thamodaran that the members of the erstwhile management had not cooperated with him during the CIRP and therefore he was not able to assess the viability of the business and was not able to carry on the business of the CD. Apart from making this statement about non-cooperation, Mr. R. Thamodaran has not submitted any evidence as to in what manner he sought co-operation from the directors of the suspended board and what was their response. Further the statement by Mr. R. Thamodaran about non-cooperation by the directors of the suspended board of the CD is all the more reason that his action of delegating his authority to Mr. A. Sureshkumar was inappropriate.
2.1.24 In view of the foregoing paragraphs, the DC finds that the Mr. R. Thamodharan had contravened Sections 17(1), 18(d), 25(1), and 28(1)(h) of the Code, read with Clause 14 of the Code of Conduct specified in the first schedule of the IP Regulations. Accordingly, the DC holds the contravention.
2.2 Failure to comply with GST Laws.
2.2.1 Section 17(2)(e) of the Code provides that the IRP shall be responsible for complying with the requirements under any law for the time being in force on behalf of the CD. Section 23(2) of the Code provides that the RP shall exercise powers and perform duties as are vested or conferred on the IRP.
2.2.2 Further, as per the Circular No.134/04/2020-GST issued by the CBIC, Ministry of Finance, the CD who is undergoing CIRP is to be treated as a distinct person of the corporate debtor and shall be liable to take a new registration in each State or Union territory where the corporate debtor was registered earlier, within thirty days of the appointment of the IRP/RP. Further, IRP/RP will be liable to furnish returns, make payment of tax and comply with all the provisions of the GST law during the CIRP period.
2.2.3 It has been observed from Mr. R. Thamodharan’s reply to the Board that he had admitted the fact of allowing the suspended management to file the GST returns. Mr. R. Thamodharan further justified this by stating that as the suspended management was delegated with the task of running the operations of CD, it was their responsibility to file the GST returns.
2.2.4 It is, thus, noted that Mr. R. Thamodharan prima facie failed to obtain new GST registration of the CD after initiation of the CIRP and rather directed the suspended management to file the GST returns post initiation of the CIRP, thereby abdicating his responsibility as an IRP/RP.
2.2.5 Thus, Board was of the prima-facie view that Mr. R. Thamodharan had contravened Section 17(2)(e) read with Section 23(2) of the Code further read with Clause 27 A of Code of Conduct specified in the first schedule of the IP Regulations, and Circular No.134/04/2020-GST dated 23.03.2020 issued by the CBIC, Ministry of Finance.
Submissions by Mr. R. Thamodharan.
2.2.6 Mr. R. Thamodharan submitted that the requirement to obtain a new GST registration arises only when the business operations of the corporate debtor are continued during the CIRP. Mr. R. Thamodharan further submitted that there were no business operations of the CD after the commencement of the CIRP, and only residual commitments existing prior to the CIRP commencement date were completed. Accordingly, there was no necessity to obtain a fresh GST registration during the CIRP.
2.2.7 Mr. R. Thamodharan submitted that the CIRP in the present case commenced on 10.07.2023. The GST return for the month of July 2023 related to transactions for the period prior to the CIRP commencement date. Therefore, Mr. R. Thamodharan cannot be held responsible for the same and rightly directed the suspended management to file the GST return for July 2023. Since there was no business activity carried on post commencement of CIRP, there was no requirement to obtain any new GST registration. However, as the existing registration of the corporate debtor was not surrendered, ‘NIL’ returns were required to be filed for the said registration for each subsequent month.
2.2.8 Mr. R. Thamodharan further submitted that he had duly intimated to the GST department on 27.07.2023 by way of email as well as registered post, quoting the existing GST registration number and requesting the department to submit its claim. Despite such intimation, no claim was received from the GST department. Mr. R. Thamodharan further submitted that the suspended management failed to hand over the user ID and password for accessing the GST portal, which was also brought to the attention of the Hon’ble NCLT in Application No. A(IBC)/593(CHE)/2024. Due to non-availability of credentials, Mr. R. Thamodharan could not surrender or cancel the old GST registration. As per the applicable GST regulations, a new registration is required to be obtained only if business operations are being carried out during the CIRP. Since no such operations took place, there was no requirement to obtain a new registration.
2.2.9 Mr. R. Thamodharan submitted that the given GST circular clearly provides at Page 2, Sr. No. 2, that “It is clarified that the GST registration of an entity for which CIRP has been initiated should not be cancelled under the provisions of Section 29 of the CGST Act.” The said circular further clarifies that the IRP/RP is required to obtain a new registration only where business operations are conducted during CIRP. In the present case, since no business activity was undertaken, the requirement to obtain a new registration did not arise. As the existing GST registration was not cancelled, it was the duty of the authorised signatory, i.e., the suspended management, to file NIL returns under the existing registration. The IRP/RP, in order to ensure compliance with the GST provisions, made consistent follow-ups with the promoters to file such NIL returns. However, due to their non-cooperation and the lack of login credentials, the IRP/RP was unable to file NIL returns personally.
2.2.10 Mr. R. Thamodharan submitted that there was no violation of GST compliance requirements and all actions taken were in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016, and the applicable GST laws and circulars.
Analysis and Findings of the DC.
2.2.11. The DC notes that the CBIC Circular No. 134/04/2020-GST dated 23.03.2020 provides for fresh GST registration of the CD during the CIRP. The relevant para of the circular is as follows:
“3. Should a new registration be taken by the corporate debtor during the CIRP period?
The corporate debtor who is undergoing CIRP is to be treated as a distinct person of the corporate debtor and shall be liable to take a new registration in each State or Union territory where the corporate debtor was registered earlier, within thirty days of the appointment of the IRP/RP. Further, in cases where the IRP/RP has been appointed prior to the issuance of notification No.11/2020- Central Tax, dated 21.03.2020, he shall take registration within thirty days of issuance of the said notification, with effect from date of his appointment as IRP/RP.”
2.2.12. In terms of section 17(2)(e) of the Code, it was the duty of Mr. R. Thamodaran to comply with all applicable laws on behalf of the CD. The said provides as follows:
“17. Management of affairs of corporate debtor by interim resolution professional. –
(1)….
(2) The interim resolution professional vested with the management of the corporate debtor,
shall-
(a)….
(e) be responsible for complying with the requirements under any law for the time being in force on behalf of the corporate debtor.”
2.2.13. The DC is of the view that it was the statutory duty of Mr. R. Thamodaran to take new GST registration for the CD within thirty days after he assumed his charge as IRP/RP of the CD. The DC finds that the submission of Mr. R. Thamodaran that the GST registration is required to be taken only in cases where business operations of the CD are conducted during the CIRP, is incorrect. The above-mentioned provision from the CBIC circular is very clear that a new registration has to be taken for the CD during the CIRP period and it nowhere makes any distinction as to the functioning or non-functioning of the operations of the CD. In the said circular of the CBIC, no exception has been given that if business of the CD cannot be continued during the period of CIRP, no new GST registration is required.
2.2.14. The DC notes that the said circular complements the statutory duty of the Interim Resolution Professional and Resolution Professional in terms of Section 20(1) and Section 25(1) respectively, to manage the business of a corporate debtor as a going concern. There exists no case for an Insolvency Professional to pre-empt that the business of CD cannot be continued during the CIRP. There is no such discretion provided in the Code or regulations made thereunder and therefore the said circular of the CBIC needs to be complied without any exception or qualification.
2.2.15. In view of the above, the DC finds Mr. R. Thamodaran had contravened Section 17(2)(e) read with Section 23(2) of the Code further read with Clause 27A of the Code of Conduct and Circular No.134/04/2020-GST dated 23.03.2020 issued by the CBIC, Ministry of Finance. Accordingly, the DC holds the contravention.
3. Order.
3.1. In view of the foregoing discussion, the DC in exercise of the powers conferred under Section 220 of the Code read with Regulation 13 of the IBBI (Inspection and Investigation) Regulations, 2017 hereby suspends the registration of Mr. R. Thamodharan (Registration No. IBBI/IPA-001/IP-P-02292/2021-2022/13592) for a period of one year.
3.2. This Order shall come into force on expiry of 30 days from the date of its issue.
3.3. A copy of this order shall be sent to the CoC/Stake Holders Consultation Committee (SCC) of all the corporate debtors in which Mr. R. Thamodharan is providing his services, and the respective CoC/SCC, as the case may be, will decide about continuation of existing assignment of Mr. R. Thamodharan.
3.4. A copy of this order shall be forwarded to the Indian Institute of Insolvency Professionals of ICAI where Mr. R. Thamodharan is enrolled as a member.
3.5. A copy of this order shall also be forwarded to the Registrar of the Principal Bench of the National Company Law Tribunal, New Delhi, for information.
3.6. Accordingly, the show cause notice is disposed of.
