17 Sept 2026
ED widens scrutiny of possible irregularities in IBC proceedings | Explained
The Enforcement Directorate has widened its scrutiny of insolvency cases under the Insolvency and Bankruptcy Code (IBC). Director Rahul Navin asked zonal officers to re-check resolutions with unusually large haircuts, related-party claim inflation, and possible misuse of the Committee of Creditors. This affects promoters, resolution professionals, and creditors. Keep clean records, and expect questions if a resolution looks collusive.
Key Statutory Highlights
- ED Director Rahul Navin told zonal officers at the 36th Quarterly Conference in Bengaluru on September 14 and 15 to re-examine alleged collusive resolution cases.
- The agency flagged possible circumvention of Section 29A of the IBC, inflation of related-party claims, manipulation of the Committee of Creditors, asset stripping, and artificially large haircuts.
- In February 2026, the ED arrested Arvind Kumar, former resolution professional of Richa Industries Limited, alleging he helped create a manipulated CoC; public-sector banks got Rs.40 crore against admitted claims of Rs.708 crore, a 94% haircut.
Actionable Advice for Taxpayers / Founders:If you are a promoter, creditor or resolution professional in an ongoing insolvency matter, review your claims, valuations and committee records carefully and take professional advice before agreeing to any resolution plan, since the ED may examine transactions under the PMLA.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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