The 164-store chain, which Sir Philip bought in 2000 for A$387 million ($420 million) failed after being starved of investment and failing to keep up with its High Street competitors like Zara and H&M.
It's been widely described as the stepping stone to the big time for the billionaire who paid more than A$775 million ($840 million) in dividends to his wife in Monaco during his 15-year ownership.
However last year, Sir Philip offloaded it to a twice-bankrupt man named Dominic Chappell leading a group of investors called Retail Acquisitions Limited for the nominal sum of £1 ($2.10).
Now the man once knighted for his business services and dubbed "king of the High Street" has been branded the "unacceptable face of capitalism" by one Conservative MP.
The sale is the subject of an investigation by the UK pension regulator as well as the business select committee who is looking into whether Arcadia did enough to ensure Retail Acquisitions Limited would be a responsible owner of the chain.
Business select committee chair Ian Wright said there are "enormous questions" about the sale of the company which will be put to the lawyers, bankers, auditors and others involved.
"The question that we want to ask Sir Philip Green, is, 'You bought BHS, took enormous sums out of the business, the pension scheme went from surplus to deficit and then you sold it for £1 to somebody who was twice bankrupt and who had no experience whatsoever of the retail sector - is that appropriate stewardship of a big, important company?" he told the BBC.
Mr Wright also said it raises questions about whether directors acted in the best interests of the company and staff or simply enriched themselves and left others to pick up the tab.
"Is there too much of an incentive in the system for owners to asset-strip, take out vast sums for personal gain, and then dump and run leaving the taxpayer to pick up the tab when the company fails, rather than create value for the long-term?" he said.
'Bullying billionaire'
The methodical exposure of the toxic deal was revealed by Sunday Times journalist Oliver Shah who charted the steps that led to the downfall of the High Street chain.
On Sunday, he wrote of his experience with the explosive billionaire who had tried to both threaten and charm him into submission by offering exclusive interviews and then shouting he would "come round to your office and punch you on the f****** nose".
The BHS deal in 2000 is credited as catapulting Green to the big time. Biographer Stuart Lansley told the BBC it allowed him to move from having a "few million to a few billion" in a few short years.
"He learned the way to make big bucks was essentially to do what's known in the trade as a 'leveraged buyout," he said.
"He borrowed very large sums of money, invested a little bit himself, and bought up companies that were relatively cheap, because they weren't doing very well. He turned them around, paying-off his debt, and then tripling - quadrupling - the money he put in, in a matter of a couple of years."
It's understood the Serious Fraud Office is looking into the BHS deal which was arranged by convicted fraudster Paul Sutton.
Sir Philip's wife, Lady Green, is also expected to face questions over her role in the deal which has helped the couple fund a lavish lifestyle in Monaco where they commute to London via private jet.
'Marie Antionette moment'
The saga is unfolding as British model Stella Maxwell walked the red carpet at the Met Ball wearing Topshop and Sir Philip recently took delivery of a A$200 million ($217 million) superyacht.
Although it had been ordered four years earlier, the boat arriving at the same time as 11,000 people faced losing their jobs was dubbed a mistake of 'Marie Antoinette' proportions and public sympathy for the billionaire - who is worth an estimated between A$5 billion ($5.4 billion) and A$7 billion ($7.5 billion) is low.
For now, BHS is trading as usual while administrators claim they are looking for US based investors to take it over.
Dominic Chappell has said he is working on a rescue package that could see a "substantial majority" of stores stay running, saying: "After the administration, when the pensions side of the business is sorted out, we will be able to move on."
However former BHS director Nick Bradley slammed the plans as "pure fantasy" and called for Green to be stripped of his title.
"I hope Philip ends up in front of the MPs' select committee and loses his knighthood," he said.
"I think a lot of people would feel the same."
If Sir Philip is found to have been negligent he may be forced to hand back some of the assets in a move that could hurt the Arcadia group. That empire includes Topshop, Topman, Miss Selfridge, Dorothoy Perkins and Wallis and is renowned for famed collaborations with stars such as Beyonce's recent Ivy Park range and Kate Moss.
The latest financial statement for the group claims it sold BHS to focus on growth of other brands internationally. The company said it reported total profit before goodwill of A$486 million last financial year, although with retail sales down -0.9 per cent in the UK.
