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CS Professional · Corporate Restructuring, Valuation and Insolvency · Role, Functions and Duties of IP, IRP and RP

Mr. Arvind Menon, an insolvency professional, handled a liquidation but did not follow the bye-laws of his agency on fee disclosure, saying the bye-laws are only advisory. Which clause of the code of conduct in section 208(2) does this conduct violate?

He violates the clause requiring compliance with all requirements and terms and conditions specified in the bye-laws of the insolvency professional agency of which he is a member. Section 208(2)(b) makes bye-laws binding on members, so treating them as advisory is not permitted.

  1. AAllowing the agency to inspect his records
  2. BComplying with all requirements and terms and conditions specified in the bye-laws of the agency of which he is a memberCorrect
  3. CSubmitting records of proceedings before the Adjudicating Authority to the Board
  4. DTaking reasonable care and diligence only in individual bankruptcy

Explanation

Section 208(2)(b) obliges every insolvency professional to comply with all requirements and terms and conditions in the bye-laws of the agency of which he is a member. Bye-laws are therefore binding, not advisory. The other clauses concern inspection, record submission and diligence, which are not what is breached here.

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