Punjab National Bank & Ors. Financial ... vs Piyush Colonisers Ltd. Through ...
- CitationCompany Appeal (AT) (Insolvency) No. 723 of 2022
Ratio decidendi
The rule this decision rests on
Where the Committee of Creditors has passed a resolution for replacement of the Resolution Professional by the requisite majority under Section 27 of the Insolvency and Bankruptcy Code, 2016, the Adjudicating Authority does not commit an error in replacing the Resolution Professional on the basis of that resolution. A creditor with minority voting share who challenges the appointment of a replacement Resolution Professional on the ground of ineligibility, such as being a related party, is not left without remedy: the proper course is to invoke Section 27 and seek a fresh CoC resolution by requisite majority declaring the appointee ineligible and replacing him, rather than to appeal against the order of appointment.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Punjab National Bank & Ors. ...Appellants
Versus
Piyush Colonisers Ltd. Through Resolution Professional Ashish Singh ...Respondent
Present: For Appellants: Mr. Janender Kumar Chumbak and Ms. Asmita Duggal, Advocates. For Respondent: Mr. Nagesh Putthige, Sr. Advocate with Mr. Chandrashekhar A. Chakalabbi, Mr. Anshul Rai, Mr. Girish Deendayalan and Mr. Akshay Sharma, Advocates.
ORDER
(Virtual Mode)
05.07.2022: Heard learned counsel for the Appellant. This Appeal has
been filed against the order dated 09.05.2022 passed by the Adjudicating
Authority (National Company Law Tribunal), New Delhi, Principal Bench by
which I.A. No.2073 of 2022 filed by the Resolution Professional has been
allowed.
2. The Application was filed for replacement of the then Resolution
Professional Mr. Umesh Garg and to appoint Mr. Ashish Singh, Insolvency
Professional. The Committee of Creditors (CoC) in its meeting held on
18.04.2022 passed a resolution with 80.42% vote for removing the Resolution
Professional Mr. Umesh Garg and replace him with Mr. Ashish Singh,
Cont'd.../ 2
Insolvency Professional. On the basis of said resolution, Application was filed
and the Adjudicating Authority allowed the Application and appointed Mr.
Ashish Singh as Resolution Professional.
3. The Appellant, who is a CoC member having minority voting share of
20% has come up in this Appeal challenging the order appointing Mr. Ashish
Singh as Resolution Professional. It is submitted by learned counsel for the
Appellant that Mr. Ashish Singh is not eligible since he is a related party.
4. We are of the view that CoC having passed resolution for replacement
of the Resolution Professional with requisite majority as per Section 27 of the
Code, the Adjudicating Authority did not commit any error in replacing the
Resolution Professional. It is always open to the Appellant to take recourse
of Section 27 and in event the CoC with requisite majority resolve that Mr.
Ashish Singh is not eligible, decision can be taken to replace Mr. Ashish Singh
with another Resolution Professional. In facts of the present case, we do not
find any good ground to entertain this Appeal. With above observations we
dismiss the Appeal.
[Justice Ashok Bhushan] Chairperson
[Justice M. Satyanarayana Murthy] Member (Judicial)
[Barun Mitra] Member (Technical) Archana/nn
Company Appeal (AT) (Insolvency) No. 723 of 2022
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