The National Company Law Appellate Tribunal (NCLAT) has ruled that cancelling insolvency professional Deepak Kumar Goyal’s registration was disproportionate to the violations established against him. The tribunal upheld 2 regulatory violations but directed the Insolvency and Bankruptcy Board of India (IBBI) to reconsider the penalty within 30 days of receiving its order.
Goyal was appointed on July 4, 2024, as the authorised representative of homebuyers in the corporate insolvency resolution process of Revital Realty Private Limited. The group grew from around 573 to 1,428 homebuyers and held nearly 91% of the voting share in the committee of creditors.
On August 20, 2026, IBBI’s Disciplinary Committee cancelled Goyal’s registration over 2 findings. These concerned incomplete records of consultations with homebuyers and his agreement to extensions for revised resolution plans without obtaining prior instructions from the creditors. Goyal challenged both findings and the penalty before NCLAT.
The tribunal upheld the first violation, noting that Regulation 16A(10)(i) requires authorised representatives to document consultation proceedings and prepare meeting minutes.
Goyal argued that emails and other communications recorded the concerns of homebuyers. NCLAT acknowledged that these records showed consultations had taken place. However, they did not consistently establish the number of participating homebuyers or their representative status. The tribunal treated this as incomplete documentation rather than a complete failure to consult or deliberate concealment.
The second violation involved extensions granted on March 17 and March 19, 2026, for submitting revised resolution plans. NCLAT held that Section 25A(3) of the Insolvency and Bankruptcy Code requires authorised representatives to follow prior instructions from the financial creditors they represent.
The tribunal rejected the argument that procedural decisions were exempt from this requirement. However, it noted that the extensions were administrative in nature, with the later extension linked to a claim by the Employees’ Provident Fund Organisation. There was no evidence that the decisions favoured any resolution applicant or harmed homebuyers.
NCLAT also noted that the case involved no allegations or findings of fraud, dishonesty, personal financial gain, collusion or conflict of interest. It considered Goyal’s clean disciplinary record, the absence of identified harm to creditors and the fact that this was his first assignment as an authorised representative.
Based on these factors, the tribunal concluded that cancellation, the most severe available disciplinary measure, was disproportionate to the established violations. It did not prescribe an alternative penalty, leaving the decision to IBBI.
In its judgment dated October 14, 2026, NCLAT directed IBBI to reconsider the appropriate penalty within 30 days of receiving the order. The cancellation will remain inoperative until IBBI issues fresh findings.
Goyal has undertaken not to accept new assignments during this period. His existing role as authorised representative will remain subject to the replacement resolution passed by the committee of creditors.
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