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CS Professional · Corporate Restructuring, Valuation and Insolvency · Insolvency

Neha, a member of an insolvency professional agency, is accused of failing to follow the agency's bye-laws. Which of the following is the agency empowered to do under the Code's list of its functions?

The agency may suspend or cancel Neha's membership on the grounds set out in its bye-laws. Section 204(e) lists this among the functions of an insolvency professional agency, which also monitors members' performance and lays down standards of professional conduct.

  1. ASuspend or cancel her membership on the grounds set out in its bye-lawsCorrect
  2. BOrder liquidation of the corporate debtor she handled
  3. CApprove resolution plans submitted in her case
  4. DAppoint her as liquidator in every pending matter

Explanation

Section 204(e) lets an insolvency professional agency suspend or cancel membership of its members on grounds set out in its bye-laws. Approving plans and ordering liquidation are not agency functions in the listed text, and no function allows automatic appointments.

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