IBBI Suspends Resolution Professional for Two Years Over Section 29A Lapses and Wilful Defaulter Verification Failure

The Insolvency and Bankruptcy Board of India (IBBI) Disciplinary Committee recently issued a stringent order penalizing an insolvency professional for severe dereliction of duty. Through Order No. IBBI/DC/317/2026 dated 22 April 2026, the regulatory body suspended the registration of Mr. Vishal Ghisulal Jain for a period of two years. The disciplinary action stemmed from his failure to conduct contemporaneous due diligence, which ultimately led to the presentation and approval of an ineligible resolution plan before the Committee of Creditors (CoC).

This comprehensive summary analyzes the factual matrix, the legal arguments presented, and the Disciplinary Committee's rationale for holding the professional guilty of contravening multiple provisions of the Insolvency and Bankruptcy Code, 2016 and its allied regulations.

Factual Matrix of the Corporate Insolvency Resolution Process

The Corporate Insolvency Resolution Process (CIRP) of M/s. Wadhwa Buildcon LLP was initiated by the National Company Law Tribunal (NCLT), Mumbai Bench, on 28.07.2020. Initially, Mr. Rakesh Kumar Tulsyan took charge as the Interim Resolution Professional. Shortly after, the adjudicating authority appointed Mr. Vishal Ghisulal Jain as the Resolution Professional on 14.10.2020. Much later in the timeline, on 02.07.2024, he was replaced by Mr. Manish Lalji Dawda.

During the resolution process, the Resolution Professional received a resolution plan from Mr. Ankit Wadhwa on 21.01.2021. Another joint plan was submitted by Mr. Bhagwandas Mulchandani and Mr. Hari Mulchandani on 27.02.2021. These plans were opened during the 7th CoC meeting held across 29.04.2021 and 06.05.2021, despite protests from the Bank of India. However, no substantive discussion or voting occurred at that stage.

Fast forward to the 10th CoC meeting on 25.03.2022, the creditors permitted the prospective resolution applicants to submit revised plans. A critical turning point occurred on 30.10.2022 when Indiabulls Housing Finance Limited officially declared Mr. Ankit Wadhwa a wilful defaulter. Despite this severe disqualification, Mr. Ankit Wadhwa submitted a revised resolution plan on 11.11.2022.

Mr. Vishal Ghisulal Jain presented this revised plan to the CoC, which eventually approved it on 20.01.2023. The adjudicating authority later rejected this plan on 20.03.2024 upon discovering the applicant's ineligibility, prompting the IBBI to issue a Show Cause Notice (SCN) on 29.07.2024.

The primary allegation against the Resolution Professional was the violation of Section 29A(b) of the Insolvency and Bankruptcy Code, 2016. This specific provision strictly bars any individual classified as a wilful defaulter under the guidelines of the Reserve Bank of India (issued under the Banking Regulation Act, 1949) from submitting a resolution plan.