Suspension power under insolvency regulations upheld as constitutionally valid under the governing framework.

The power to suspend under Regulation 23A of the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016, read with Section 140 of the Insolvency and Bankruptcy Code, 2016, was held to be constitutionally valid. The Court accepted that the suspension power is traceable to the regulatory framework governing empanelment, de-empanelment and suspension of resolution professionals, and that this framework supports the exercise of such power. It found no constitutional infirmity under Articles 14, 19 or 21, and the challenge to the validity of the suspension power failed.

---

---

Issues: Whether the power to suspend under Regulation 23A of the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016 read with Section 140 of the Insolvency and Bankruptcy Code, 2016 is constitutionally valid and violates Articles 14, 19 and 21 of the Constitution of India.

Analysis: The challenge was directed to the constitutional validity of the regulatory power enabling suspension. The Court accepted the view that the impugned power is traceable to Regulation 23A read with Section 140 of the Insolvency and Bankruptcy Code, 2016. It further agreed with the prior finding that the framework dealing with empanelment, de-empanelment and suspension of resolution professionals supports the exercise of such power. On that basis, the Court found no constitutional infirmity under Articles 14, 19 or 21 of the Constitution of India.

Conclusion: The challenge to the validity of the suspension power failed, and the impugned provisions were upheld as not violative of Articles 14, 19 or 21.

---