Monetary penalty for certain non-disclosures and contraventions by insolvency professionals
Here are the list of monetary penalty mandated by the insolvency regulator for certain non-disclosures and non-compliances by insolvency professionals
| Contraventions | Monetary Penalty |
| Fails to submit disclosures, returns, etc. to Insolvency Professional Agency or submits inadequate or incorrect disclosures, returns, etc., relating to any assignment, as required under the Code and Regulations made thereunder or bye-laws of the Agency or called upon by the Board or the Agency. | Up to ₹ 1,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 50,000. |
| Accepts an assignment having conflict of interests with the stakeholders | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Fails to maintain records properly relating to any of his assignments | Up to ₹ 1,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 50,000. |
| Rejects a claim(s) without giving any proper reason while undertaking an assignment or fails to exercise due diligence in claim verification. | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Fails to comply with directions issued by Adjudicating Authority or the Appellate Authority | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Outsources his duties and obligations. | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Fails to appoint registered valuers, wherever required, under the Code or Regulations made thereunder, for conducting valuation. | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Fails to supply the information called for or to comply with the requirements of information sought by the Agency, Board, Adjudicating Authority or the Appellate Authority or does not cooperate with the inspection or investigating authority | Up to ₹ 1,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 50,000. |
| Fails to make public announcement in the manner provided for in the relevant Regulations. | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Fails to provide notice regarding meetings of creditors. | Up to ₹ 1,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 50,000. |
| Fails to reject resolution plan from ineligible resolution applicants. | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Fails to take action in respect of preferential, undervalued, fraudulent or extortionate credit transactions | Up to ₹ 2,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 1,00,000. |
| Enters into contract or agreement with professionals in an incomplete and improper manner. | Up to ₹ 1,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 50,000. |
| Contravenes any provision of the bye-laws, or regulations for which no specific penalty has been provided. | Up to ₹ 1,00,000 or 25% of fee, whichever is higher, subject to a minimum ₹ 50,000. |
Also Read: IP agencies can now levy monetary penalty on insolvency professionals
