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CS Professional · Insolvency and Bankruptcy - Law and Practice · Professional and Ethical Practices for Insolvency Practitioners

The Board's inspecting team investigates an insolvency professional, Karan Mehta, for suspected breach of the Code. Karan declines to hand over his working papers and says only a civil court can compel production. Which view is correct under the Code?

Karan's view is incorrect. Section 196(3) vests the Board with civil court powers under the Code of Civil Procedure, 1908, including discovery and production of books and documents, summoning and examining persons on oath, inspection of records and issuing commissions, so the Board can compel his working papers.

  1. ACorrect, as the Board can only request documents and cannot compel them
  2. BCorrect, because investigations of professionals are reserved for the Adjudicating Authority
  3. CIncorrect, because the Board has civil court powers under the Code of Civil Procedure, 1908 for discovery and production of books of account and documents, and can also summon persons and examine them on oathCorrect
  4. DIncorrect, but the Board's powers are limited to inspecting documents only after Karan consents

Explanation

Section 196(3) gives the Board the powers of a civil court trying a suit for discovery and production of books and documents, summoning persons and examining them on oath, inspection of books, and issuing commissions. Karan's refusal therefore has no basis. Option D is wrong because no consent condition exists.

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