IBC Section 206: Enrolled and registered persons to act as insolvency professionals

Section 206 of Insolvency and Bankruptcy Code, 2016: Enrolled and registered persons to act as insolvency professionals

Official Bare Act Text

Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary

No person shall render his services as insolvency professional under this Code without being enrolled as a member of an insolvency professional agency and registered with the Board.

Legal Commentary & Landmark Judgments: Section 206

Section 206 strictly mandates that no person shall act as an Insolvency Professional unless enrolled with an IPA and registered with the Board.

Dual Statutory Prerequisite: An individual must be enrolled as a professional member with a registered IPA and hold a valid registration certificate issued by the IBBI.
Prohibition Against Unregistered Practice: Strict bar against any person acting, representing, or accepting appointments as an interim resolution professional, resolution professional, liquidator, or bankruptcy trustee without valid registration.
Authorization for Assignment (AFA): Must possess a valid Authorization for Assignment issued by the concerned IPA for the relevant period.

Key Landmark Precedents:

Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC 17: The Supreme Court observed that the dual registration framework guarantees that practitioners managing large corporate assets possess verifiable credentials.
ArcelorMittal India Pvt. Ltd. v. Satish Kumar Gupta (2019) 2 SCC 1: Affirmed that only statutorily qualified insolvency practitioners can assume control of defaulting corporate debtor affairs.

Courtroom Practice & Strategic Litigation Guidance:

Before voting to confirm an IRP or appointing a liquidator, the Committee of Creditors must verify the professional's live AFA status on the IBBI portal; appointments made without a valid AFA are void ab initio.