Issues: (i) Whether the show cause notice issued to the insolvency professional was valid under the pre-amendment statutory scheme when the investigation report found no actionable material and the notice rested on matters extraneous to that investigation; (ii) Whether the disciplinary order finding contraventions concerning constitution of the stakeholders' consultation committee, disclosure of liquidation costs, and delay in auction notices was vitiated by procedural infirmity and breach of natural justice.

Issue (i): Whether the show cause notice issued to the insolvency professional was valid under the pre-amendment statutory scheme when the investigation report found no actionable material and the notice rested on matters extraneous to that investigation.

Analysis: Under Section 219 of the Insolvency and Bankruptcy Code, 2016, as it stood before the amendment of 6 April 2026, a show cause notice could follow completion of investigation under Section 218. Regulation 11 of the Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017 required consideration of the investigation report and formation of a prima facie opinion that sufficient cause existed for action. The investigation report found no actionable material on the complaints that initiated the inquiry, whereas the notice alleged five distinct matters outside those complaints and the investigation findings. Although the regulator may act on its own motion where warranted, it must identify and furnish the material forming the basis for such action.

Conclusion: The show cause notice was procedurally vitiated, being founded on extraneous and undisclosed material despite the investigation report containing no adverse actionable material; this finding is in favour of the petitioner.

Issue (ii): Whether the disciplinary order finding contraventions concerning constitution of the stakeholders' consultation committee, disclosure of liquidation costs, and delay in auction notices was vitiated by procedural infirmity and breach of natural justice.

Analysis: Writ review was confined to procedural legality and not an appellate reassessment of disciplinary findings. The disciplinary authority failed to consider material circumstances and defences relevant to each charge. The liquidator's view that secured financial creditors who had relinquished security formed one class under Regulation 31A(3) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 was a reasonably possible interpretation, particularly as the other creditors attended the meetings and raised no objection. The finding on liquidation costs improperly considered meetings beyond those specified in the show cause notice, while Regulation 31A(6B) had not yet come into force when notice for the fourth meeting was issued. The authority also disregarded material showing that obstruction by the promoters affected the auctions and that the adjudicating authority had condoned the auction delays.

Conclusion: The disciplinary findings and suspension order were vitiated by failure to consider relevant material, consideration beyond the charged meetings, and violation of principles of natural justice; this finding is in favour of the petitioner.

Final Conclusion: The regulatory disciplinary action could not stand under the applicable pre-amendment procedure, and the order imposing suspension was quashed.

Ratio Decidendi: A disciplinary show cause notice and consequential order under the pre-amendment insolvency framework are invalid where they depart from the investigation findings without disclosing the independent material relied upon and ignore material defences and relevant circumstances bearing on the alleged contraventions.

Issues: Whether an approved insolvency resolution plan extinguishes GST liabilities relating to the period subsequent to its implementation date.

Analysis: The resolution plan contemplated waiver of indirect-tax dues up to the implementation date, with the requested relief left for consideration by the appropriate authorities. The petitioner had not sought waiver of interest or penalty for liabilities covered by the plan. The plan did not extend to the tax period involved in the impugned proceedings, which fell after the relevant implementation period. The statutory amendments to the insolvency regime and the applicable legal position did not support application of the resolution plan to those subsequent liabilities.

Conclusion: The approved resolution plan does not extinguish GST liability for the post-implementation period covered by the impugned order.

Issues: Whether Section 96(4) of the Insolvency and Bankruptcy Code, 2016, inserted with effect from 26.05.2026, applies to pending insolvency applications concerning personal guarantors to corporate debtors and removes the interim-moratorium bar to the suit.

Analysis: Section 96(4) was introduced to address misuse of the interim moratorium by personal guarantors who initiated insolvency proceedings to obstruct recovery action. The amendment operates prospectively upon the existing status of a pending insolvency application and is retroactive or quasi-retroactive, rather than truly retrospective. The expression "is filed" encompasses applications filed before the amendment that remained pending when it came into force. The removal of the pre-admission protection does not impair a vested right, but restores creditors' ability to pursue remedies during pending proceedings.

Conclusion: Section 96(4) applies to the pending Section 95 application; the interim moratorium in favour of the personal guarantor stood vacated from the amendment's effective date, and the suit is not barred. The application for rejection of the plaint was rejected.

Issues: (i) Whether the Insolvency and Bankruptcy Board of India has statutory authority to levy the regulatory fee under Regulation 31A; (ii) Whether Regulation 31A is ultra vires the Insolvency and Bankruptcy Code, 2016 because regulatory fee cannot form part of insolvency resolution process costs; (iii) Whether the regulatory fee is a tax disguised as a fee for want of quid pro quo; (iv) Whether the regulatory fee is excessive, disproportionate and arbitrary under Article 14 of the Constitution of India; (v) Whether the proviso to Regulation 31A operates retrospectively; (vi) Whether Regulation 31A involves a colourable exercise of power or excessive delegation.

Issue (i): Whether the Insolvency and Bankruptcy Board of India has statutory authority to levy the regulatory fee under Regulation 31A.

Analysis: Section 196(1)(c) authorises the Board to levy fees or other charges for carrying out the purposes of the Code; this authority is not confined to registration and renewal fees payable by insolvency professionals, insolvency professional agencies and information utilities. Sections 196 and 240 disclose the Board's broad executive, quasi-judicial and quasi-legislative role across the corporate insolvency resolution process, including matters concerning the committee of creditors, voting, resolution plans and process costs.

Conclusion: Regulation 31A was made within the Board's statutory authority; the issue is against the petitioners.

Issue (ii): Whether Regulation 31A is ultra vires the Insolvency and Bankruptcy Code, 2016 because regulatory fee cannot form part of insolvency resolution process costs.

Analysis: Section 5(13)(e) is a residuary provision permitting costs specified by the Board, and Section 240(2)(d) expressly authorises regulations concerning such other costs. The distinct categories in Section 5(13)(a) to (d) do not constitute a common genus. Consequently, ejusdem generis and noscitur a sociis cannot restrict Section 5(13)(e). Regulation 31(ba), read with Regulation 31A, validly includes the regulatory fee within insolvency resolution process costs.

Conclusion: Regulation 31A is not ultra vires the Code; the issue is against the petitioners.

Issue (iii): Whether the regulatory fee is a tax disguised as a fee for want of quid pro quo.

Analysis: For a regulatory fee, direct and arithmetically precise quid pro quo is unnecessary; a broad, general nexus between the levy and regulatory services is sufficient. The Board's regulation of insolvency service providers and its regulation-making, information, oversight and process-related functions provide an integrated regulatory framework benefiting corporate insolvency resolution process stakeholders, including resolution applicants. The levy supports the Board's regulatory functions and financial self-sufficiency.

Conclusion: The levy is a valid regulatory fee and not a tax; the issue is against the petitioners.

Issue (iv): Whether the regulatory fee is excessive, disproportionate and arbitrary under Article 14 of the Constitution of India.

Analysis: A regulatory fee need not correspond exactly to annual expenditure or yield no surplus. The audited figures showed that the levy enabled the Board to meet its expenditure after earlier deficits, and did not establish an excessive, confiscatory or disproportionate collection. The amounts remain available for the Board's regulatory functions rather than forming part of the general revenues of the State.

Conclusion: The regulatory fee is neither excessive nor arbitrary and does not violate Article 14; the issue is against the petitioners.

Issue (v): Whether the proviso to Regulation 31A operates retrospectively.

Analysis: The proviso expressly applies to resolution plans approved under Section 31 on or after 1 October 2022 and is prospective in operation. Approval by the committee of creditors binds the committee and the resolution applicant as to commercial terms, but does not reduce the adjudicating authority to a ministerial role. The adjudicating authority must ensure compliance with Section 30(2), including priority payment of insolvency resolution process costs, and may require rectification or reconsideration in limited circumstances. No vested right was disturbed while approval remained pending.

Conclusion: The proviso is prospective and valid; the issue is against the petitioners.

Issue (vi): Whether Regulation 31A involves a colourable exercise of power or excessive delegation.

Analysis: The regulatory fee at 0.25 per cent of realisable value was not shown to be confiscatory or unreasonable. Sections 5(13)(e), 196(1)(c) and 240(2)(d) provide statutory guidance for the levy and its inclusion as a process cost. The challenged regulation is also subject to parliamentary laying under Section 241. The relevant enabling provisions and Regulation 31(ba) were not independently challenged.

Conclusion: Regulation 31A is neither a colourable exercise of power nor an instance of excessive delegation; the issue is against the petitioners.

Final Conclusion: Regulation 31A validly imposes regulatory fee as an insolvency resolution process cost for resolution plans approved under Section 31 on or after 1 October 2022.

Ratio Decidendi: A statutory regulator may levy a non-excessive regulatory fee under an express power to carry out the purposes of the governing code where the levy bears a broad nexus to its regulatory functions; direct quid pro quo with each payer is not indispensable.

Issues: Whether admission of the corporate insolvency resolution process application was liable to be set aside because the financial creditor relied on photocopies of documents.

Analysis: Section 7 permits ascertainment of default from information-utility records or other evidence furnished by the financial creditor. The undisputed record of default from NeSL, the corporate debtor's acknowledged loan liabilities and deposit pursuant to the DRAT order, and the absence of a specific challenge to the pleaded date of default established default. A claimed factual error in the NCLT's recording of a concession could not be raised in the writ petition without first seeking correction of the NCLT order through an application for speaking to the minutes.

Conclusion: The admission of the application under Section 7 was valid, and no ground for writ interference was made out.

Issues: Whether GST on services rendered by an Advocate acting as an Insolvency Professional is payable under the reverse charge mechanism applicable to legal services or under the forward charge mechanism.

Analysis: Section 9(1) of the Central Goods and Services Tax Act, 2017 establishes forward charge as the default mechanism, while Section 9(3) permits reverse charge only for notified categories. Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017, as corrected on 25.09.2017, applies reverse charge to legal services supplied by advocates. Insolvency Professionals, however, are independently regulated under the Insolvency and Bankruptcy Code, 2016 and the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016. Their functions in conducting insolvency resolution are distinct from conventional legal services.

Analysis: Under the Scheme of Classification of Services, insolvency and receivership services fall under the specific service classification 998241, separately from legal services under classification 99821. The specific classification of insolvency and receivership services prevails over the general classification of legal services. The nature and capacity in which the service is supplied, rather than the supplier's underlying professional qualification or enrolment as an advocate, determine the applicable GST treatment.

Conclusion: Services rendered by an Advocate in the capacity of an Insolvency Professional are insolvency and receivership services subject to the forward charge mechanism. The Advocate must obtain GST registration and furnish GST-compliant invoices for such services; reverse charge continues to apply only to legal services rendered in the capacity of an Advocate.

Ratio Decidendi: Where a service supplied by an advocate is specifically classified as insolvency and receivership service, its GST treatment is governed by that specific classification and not by the reverse charge mechanism applicable to legal services.

Issues: Whether a writ petition challenging an order of the Disciplinary Committee under Section 220(2) of the Insolvency and Bankruptcy Code, 2016 is maintainable when a statutory appeal under Section 220(7) is available before the National Company Law Appellate Tribunal.

Analysis: Although the disciplinary order did not conclusively determine the consequences of the alleged misconduct, it was passed after consideration of a show-cause notice issued under Section 219 and expressly invoked the Disciplinary Committee's jurisdiction under Section 220(2). The order consequently fell within the class of disciplinary orders made appealable by Section 220(7), which became operative before its issuance. The statutory appeal constituted an efficacious alternative remedy, making recourse to writ jurisdiction inappropriate at the first instance.

Conclusion: The challenge must be pursued through the statutory appeal before the National Company Law Appellate Tribunal under Section 220(7) of the Insolvency and Bankruptcy Code, 2016.

Issues: (i) Whether the Economic Offences Wing may continue proceedings under the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) Act, 1997 notwithstanding the corporate insolvency proceedings; (ii) Whether the Liquidator may be supplied a complete set of seized materials and pursue recovery of the company's receivables.

Issue (i): Whether the Economic Offences Wing may continue proceedings under the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) Act, 1997 notwithstanding the corporate insolvency proceedings.

Analysis: The prior inter-parties judgment had set aside the order nullifying attachment and recognised the depositor-protection enactment as prevailing in relation to protection and redressal of depositors' claims and prosecution of related offences. That determination binds all concerned, leaving the Economic Offences Wing free to proceed under the applicable statute.

Conclusion: The Economic Offences Wing may continue its statutory proceedings notwithstanding the insolvency process.

Issue (ii): Whether the Liquidator may be supplied a complete set of seized materials and pursue recovery of the company's receivables.

Analysis: The Liquidator has an available statutory forum to recover receivables and, having stepped into the position of the company's management, is required to take steps for such recovery. Furnishing copies of the investigation materials enables that exercise without disrupting the investigation. Any sums constituting proceeds of crime or belonging to the accused company or its directors remain amenable to lawful action by the Economic Offences Wing.

Conclusion: The Liquidator is entitled to receive one complete set of the materials and to take lawful steps for recovery of receivables.

Final Conclusion: The recovery exercise by the Liquidator may proceed alongside the depositor-protection and investigation measures, while preserving the Economic Offences Wing's authority over amounts lawfully traceable to the alleged offences.

Issues: Whether the bank's order classifying the company account as fraud was unreasoned and was passed in violation of principles of natural justice.

Analysis: A fraud-classification order need not contain reasons equivalent to a judicial judgment, but must disclose due application of mind and satisfy fairness. The impugned order incorporated the transaction-audit findings, including diversion of funds through an undisclosed bank account, related-party transactions, unjustified transfers, and interest-free loans and advances; it consequently disclosed adequate reasons. The petitioners had received the draft and final transaction-audit materials, were given access to records and opportunities to furnish supporting data, and were afforded 21 days to answer the show-cause notice. Their failure to avail those opportunities and their vague request for further time justified refusal of an extension.

Conclusion: The fraud-classification order was reasoned and was not passed in breach of principles of natural justice; the finding is against the petitioners.

Ratio Decidendi: A fraud-classification decision satisfies the requirement of reasons and natural justice where it identifies and adopts material audit findings, the affected persons have prior knowledge and access to the underlying allegations and records, and a reasonable opportunity to respond is afforded but not availed.

Issues: (i) Whether an arbitral award-holder's claim, not lodged in the corporate debtor's CIRP and not included in the approved resolution plan, survives and permits continuation of the challenge to the award; (ii) Whether the amount deposited in court as security for stay of enforcement of the award is refundable to the corporate debtor after approval of the resolution plan.

Issue (i): Whether an arbitral award-holder's claim, not lodged in the corporate debtor's CIRP and not included in the approved resolution plan, survives and permits continuation of the challenge to the award.

Analysis: An amount awarded under an arbitral award constitutes a claim and the award-holder is a creditor under the Insolvency and Bankruptcy Code, 2016. The approved resolution plan binds creditors, while claims not forming part of that plan stand extinguished. The award-holder did not submit its claim to the resolution professional; consequently, its claim was not incorporated in the approved plan. Continuance of the Section 34 challenge could not revive an extinguished claim.

Conclusion: The claim under the arbitral award stood extinguished upon approval of the resolution plan, and the challenge to the award became academic, in favour of the petitioner.

Issue (ii): Whether the amount deposited in court as security for stay of enforcement of the award is refundable to the corporate debtor after approval of the resolution plan.

Analysis: A court deposit required as a condition for stay secures the award amount pending adjudication and does not transfer ownership of the money to the award-holder. Release remains subject to the court's control and may be conditioned or modified. Such deposited funds remain assets of the corporate debtor, notwithstanding custody by the court. Since the underlying award claim was extinguished, no unconditional right to the secured deposit remained with the award-holder.

Conclusion: The deposited amount, together with accrued interest, is refundable to the petitioner, in favour of the petitioner.

Final Conclusion: Approval of the resolution plan eliminated the unsubmitted award claim and preserved the corporate debtor's entitlement to funds deposited merely as security.

Ratio Decidendi: A claim under an arbitral award that is not submitted and incorporated in an approved resolution plan is extinguished, and money deposited in court solely as security for that award remains an asset of the corporate debtor.

Issues: Whether execution of the money decree against the corporate debtor could be stayed pending appeal after approval of its resolution plan, and whether deposit of the decretal amount was mandatory for such stay.

Analysis: The resolution plan approved by the adjudicating authority binds all creditors, including those who did not lodge claims, and claims not forming part of the plan stand extinguished. Continuation of proceedings founded on pre-approval claims would undermine the insolvency framework. The requirement of deposit while granting stay of a money decree is not mandatory where exceptional circumstances justify stay; the approved resolution plan and the statutory effect of Section 31 supplied such circumstances.

Outcome: Operation, execution and implementation of the impugned money decree were stayed until final disposal of the appeal; the application for additional evidence will be heard with the appeal.

Issues: (i) Whether Section 96(4) of the Insolvency and Bankruptcy Code, 2016 applies to pending insolvency-resolution applications against personal guarantors and removes the interim moratorium under Section 96(1); (ii) Whether limited protective relief for disclosure and preservation of guarantors' assets should be granted under Section 9 of the Arbitration and Conciliation Act, 1996 pending arbitration.

Issue (i): Whether Section 96(4) of the Insolvency and Bankruptcy Code, 2016 applies to pending insolvency-resolution applications against personal guarantors and removes the interim moratorium under Section 96(1).

Analysis: Section 96(4), effective from 26 May 2026, excludes applications concerning personal guarantors to corporate debtors from Section 96. The expression "where an application is filed" encompasses applications already filed and pending on the effective date. Its application to an ongoing proceeding is retroactive, not retrospective, because it operates prospectively upon an existing and continuing status without impairing vested rights. The identity of the person who initiated the insolvency application is immaterial under the amended provision.

Conclusion: The interim moratorium in respect of the personal guarantors ceased from 26 May 2026; the Section 9 petition was not barred. This issue is in favour of the Petitioner.

Issue (ii): Whether limited protective relief for disclosure and preservation of guarantors' assets should be granted under Section 9 of the Arbitration and Conciliation Act, 1996 pending arbitration.

Analysis: The arbitration agreements and indebtedness were undisputed. The relief sought was confined to asset disclosure and restraint against dissipation, rather than any direction for deposit. Such limited measures were equitable and appropriate pending arbitration, particularly after cessation of the moratorium.

Conclusion: The guarantors must disclose their assets and are restrained from dealing with the disclosed assets pending arbitration. This issue is in favour of the Petitioner.

Final Conclusion: The amended insolvency regime permits recourse to interim arbitral protection against personal guarantors whose insolvency applications remain pending, and limited asset-preservation measures may be granted pending commencement and conduct of arbitration.

Ratio Decidendi: A statutory exclusion introduced prospectively may apply to pending proceedings founded on an existing status without being retrospective; accordingly, Section 96(4) removes the automatic interim moratorium for pending insolvency applications against personal guarantors to corporate debtors.