It is understood the club was assured before the match that banners would be entirely football-related yet the Green Brigade section displayed an image of Bobby Sands, the IRA hunger striker.
This strengthened a growing belief at the club that the Green Brigade had become unmanageable.
The events at Fir Park on Friday when seats were destroyed and flares thrown on to the pitch as Celtic defeated Motherwell were the breaking point.
Celtic sources admitted yesterday they expected sanctions for the incidents causing damage that may cost £10,000 to repair.
The club has accepted liability not least because SPFL rules state that if a visiting club's supporters damage the stadium of their hosts, the away club must pay costs, but it is determined that no more accommodations be made with the Green Brigade that generally stands at section 111 at Celtic Park.
The club yesterday announced that "128 individuals" have been suspended from matches pending further investigations. The club will also relocate 250 season ticket holders from section 111 to other areas in the stadium. Refunds will be offered to season ticket holders who do not want to be moved.
The club will also be vigilant in preventing Green Brigade congregating in other parts of the ground.
The events at Fir Park have also been a "tipping point" for other Celtic fans, many of whom have protested at what happened at Motherwell with some saying they had been forced out of their seats.
Supporters' groups issued formal denunciations of the Green Brigade yesterday with Neil Doncaster, SPFL chief executive, also condemning the "shameful scenes" at Fir Park.
Doncaster has confirmed an investigation will take place once the match delegate's report arrives at Hampden.
"We have already been in touch with both clubs and the police following the disturbances during Friday night's fixture at Fir Park," Doncaster said in a statement. "We absolutely condemn this type of behaviour. It has no place in the game. We are confident that the police and both clubs will play a full part in helping to identify those involved in what were shameful scenes. We expect the SPFL Match Delegate report to be with us within the next 24 to 48 hours."
However, Celtic are determined that all steps are taken to prevent a repeat of the incidents that embarrassed the club and the dramatic clampdown on the Green Brigade is a major plank in that strategy.
UEFA is set to rule tomorrow on the breach of its rules on the displaying of political banners during the AC Milan match.