IBBI Disciplinary Action Against IRP for Failure to Take Custody of Corporate Debtor Assets: Bhasin Infotech CIRP

Overview of the Disciplinary Proceeding

The Disciplinary Committee of the Insolvency and Bankruptcy Board of India ("IBBI" or "Board") passed Order No. IBBI/DC/316/2026 dated 21st April 2026, disposing of Show Cause Notice No. COMP-11011/146/2024-IBBI-1064/1161 dated 28.07.2025 issued to Mr. Mukesh Gupta, a registered Insolvency Professional bearing Registration No. IBBI/IPA-001/IP-P-01494/2018-2019/12254 and a Professional Member of the Indian Institute of Insolvency Professionals of ICAI.

The core question before the Disciplinary Committee ("DC") was whether Mr. Mukesh Gupta, acting as the Interim Resolution Professional ("IRP") in the Corporate Insolvency Resolution Process ("CIRP") of Bhasin Infotech and Infrastructure Private Limited ("Corporate Debtor"), had failed to discharge his statutory obligation of taking custody and control of the assets and affairs of the Corporate Debtor following the commencement of CIRP — and whether an ambiguous interim order of the National Company Law Appellate Tribunal ("NCLAT") could constitute a complete defence to such alleged non-compliance.

Background and Commencement of CIRP

The CIRP of Bhasin Infotech and Infrastructure Private Limited was admitted by the National Company Law Tribunal, New Delhi Bench vide order dated 04.12.2023, on an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 ("Code") by Col. Gautam Mullick & Ors. Upon admission, Mr. Mukesh Gupta was appointed as the IRP.

The admission order specifically directed Mr. Mukesh Gupta to:

  • Issue a public announcement within three days as prescribed under Explanation to Regulation 6(1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 ("CIRP Regulations")
  • Perform all functions contemplated under Section 15, Section 17, Section 18, Section 19, Section 20, and Section 21 of the Code

In pursuance of these directions, Mr. Mukesh Gupta, upon receiving the admission order on 05.12.2023, immediately sent emails to the members of the suspended Board of Directors ("BOD") of the Corporate Debtor requesting relevant data, documents, and information necessary for discharging his statutory duties.

The NCLAT Interim Order Dated 07.12.2023 — The Root of Ambiguity

Within three days of admission of CIRP, the suspended BOD of the Corporate Debtor filed an appeal before the NCLAT challenging the admission order dated 04.12.2023. The matter was listed on 07.12.2023, at which hearing Mr. Mukesh Gupta's counsel was also present.

The NCLAT, after hearing all parties, passed its order dated 07.12.2023 in the following terms:

"After considering the submissions of the Counsel for the parties, we are of the view that the major issue between the parties is tripartite lease deed and due to reason that certain unit holders have not taken possession and have been contending that there is default on the part of the Appellant. In view of the materials which have been placed by the Appellant, the present was not a case for initiation of the CIRP since according to the Appellant all constructions are complete and units are ready to occupy. We are of the view that in the ends of justice be served by finding ways and means to protect the interest of the allottees by execution of the lease deed and by handing over the possession."

"In the meantime, in pursuance of the impugned order, no further steps shall be taken. We make it clear that the Appellant shall not create any third party interest in respect of the units of the Respondents."

Following this order, Mr. Mukesh Gupta's legal counsel communicated to him via email that:

"You are requested not to take any steps in furtherance of CIRP order."

Acting on this legal advice, Mr. Mukesh Gupta consciously refrained from issuing the public announcement, assuming control of the Corporate Debtor's assets, or undertaking any action envisaged under the CIRP commencement order dated 04.12.2023.

Statutory Framework: Duties of an IRP Under the Code

To appreciate the gravity of the alleged contravention, the DC examined the relevant statutory provisions:

Key Provisions

  • Section 17(1) of the Code: From the date of appointment of the IRP, the management of affairs of the corporate debtor shall vest in the IRP, and the powers of the Board of Directors shall stand suspended and be exercised by the IRP.

  • Section 18(1)(f) of the Code: The IRP is obligated to take control and custody of any asset over which the corporate debtor has ownership rights.

  • Section 208(2)(a) and Section 208(2)(e) of the Code: An insolvency professional must take reasonable care and diligence in performing his functions and comply with applicable provisions of the Code and regulations.

  • Regulation 7(2)(a) and Regulation 7(2)(h) of the IP Regulations read with Clauses 10 and 14 of the Code of Conduct: Mandate faithful discharge of duties and compliance with all applicable laws and professional standards.

Allegations in the Show Cause Notice

The Board, after examining the complaint received against Mr. Mukesh Gupta in relation to his role as IRP in the CIRP of Bhasin Infotech and Infrastructure Private Limited, formed a prima facie opinion and issued the SCN on 28.07.2025, alleging that: