Sharvan Kumar Vishnoi vs Crown Alba Writing Instrument P. Ltd

Sharvan Kumar Vishnoi ...Appellant

Versus

Crown Alba Writing Instrument P. Ltd. ...Respondent

Present: For Appellant : Mr. Ashok Kriplani, Advocate and Mr. Vinod Kr. Chaurasia, PCA

ORDER

28.05.2018─ This appeal has been preferred by Sharvan Kumar Vishnoi,

whose name was proposed for 'Interim Resolution Professional' by 'Bhansali

Engineering Polymers Ltd.' ('Operational Creditor'). By the impugned order dated

10th May, 2018 the Adjudicating Authority (National Company Law Tribunal,

Allahabad Bench) appointed one Mr. Anurag Goel as a 'Resolution Professional'

on the ground that the Appellant -'Shravan Kumar Vishnoi' has already been

appointed as 'Resolution Professional' in the case of 'M/s. Centenary Polytex Pvt.

Ltd. vs. Dhanashree Agro Product Pvt. Ltd.'

2. Learned counsel for the appellant submits that the 'Operational Creditor'

proposed the name of the 'Interim Resolution Professional' in terms of Section

9(4) of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the

'I&B Code'). As per Section 16(3)(b) of the I&B Code, the Adjudicating Authority

is required to appoint an 'Interim Resolution Professional' as proposed under

sub-section (4) of Section 9 subject to non-pendency of a disciplinary proceeding 2

against such 'Interim Resolution Professional'. Therefore, according to him,

except the pendency of disciplinary proceeding, the Adjudicating Authority

cannot reject the proposal of the 'Operational Creditor' on any other ground,

including the ground that the 'Interim Resolution Professional' is already

working as 'Resolution Professional' in another 'Corporate Insolvency Resolution

Process'.

3. As per sub-section (5) of Section 9 of the 'I&B Code', the Adjudicating

Authority while admitting an application under Section 9 is required to appoint

an 'Interim Resolution Professional' as proposed by the 'Operational Creditor'

under sub-section (4) of Section 9 of the 'I&B Code'.

4. The term of the 'Interim Resolution Professional' cannot exceed thirty days

from the date of his appointment as per sub-section (5) of Section 16, as quoted

below:

"16. Appointment and tenure of interim resolution

professional-

xxx xxx xxx

(5) The Term of the interim resolution professional shall not

exceed thirty days from date of his appointment."

5. On completion of term of the 'Interim Resolution Professional', a (Regular)

'Resolution Professional' is required to be appointed in terms of Section 22 of the

'I&B Code', which reads as follows:

Company Appeal (AT) (Insolvency) No. 253 of 2018 3

"22. Appointment of resolution professional -

(1) The first meeting of the committee of creditors shall be

held within seven days of the constitution of the

committee of creditors.

(2) The committee of creditors, may, in the first meeting, by

a majority vote of not less than seventy-five per cent. of

the voting share of the financial creditors, either resolve

to appoint the interim resolution professional as a

resolution professional or to replace the interim

resolution professional by another resolution

professional.

(3) Where the committee of creditors resolves under sub-

section (2)--

(a) to continue the interim resolution professional as

resolution professional, it shall communicate its

decision to the interim resolution professional, the

corporate debtor and the Adjudicating Authority; or

(b) to replace the interim resolution professional, it shall file

an application before the Adjudicating Authority for the

appointment of the proposed resolution professional.

(4) The Adjudicating Authority shall forward the name of

the resolution professional proposed under clause (b) of

Company Appeal (AT) (Insolvency) No. 253 of 2018 4

sub-section (3) to the Board for its confirmation and

shall make such appointment after confirmation by the

Board.

(5) Where the Board does not confirm the name of the

proposed resolution professional within ten days of the

receipt of the name of the proposed resolution

professional, the Adjudicating Authority shall, by order,

direct the interim resolution professional to continue to

function as the resolution professional until such time

as the Board confirms the appointment of the proposed

resolution professional."

6. From the provisions as discussed above, the following facts emerges:

i. The Adjudicating Authority is required to appoint the 'Interim

Resolution Professional' as proposed under sub-section (4) of

Section 9 of the 'I&B Code'.

ii. The term of the 'Interim Resolution Professional' automatically

comes to an end after thirty days.

iii. The 'Committee of Creditors' by majority vote of not less than

seventy-five percent of the voting share of the 'Financial Creditors',

either resolve to appoint the 'Interim Resolution Professional' as the

'Resolution Professional' or to replace the 'Interim Resolution

Professional' by another 'Resolution Professional'.

Company Appeal (AT) (Insolvency) No. 253 of 2018 5

7. The (regular) 'Resolution Professional' can be replaced by 'Committee of

Creditors' only by vote, which should not be less than seventy-five percent of

voting shares in terms of Section 27 of the 'I&B Code'.

8. In the present case, the Appellant was named as 'Interim Resolution

Professional' but the Adjudicating Authority for the grounds mentioned in the

impugned order appointed one Mr. Anurag Goel as 'Resolution Professional'.

9. We accept the submissions made on behalf of the Appellant that in normal

course the person proposed under sub-section (4) of Section 9 as 'Interim

Resolution Professional' is required to be appointed if there is no departmental

proceeding is pending. However, that does not mean that the Adjudicating

Authority has no discretion to name another person to be appointed as 'Interim

Resolution Professional', if it comes to its notice that the proposed 'Interim

Resolution Professional', named by the 'Operational Creditor' or 'Financial

Creditor' is busy in some other 'Resolution Process'.

10. In present case, as one Mr. Anurag Goel has already appointed as 'Interim

Resolution Professional' and the Insolvency & Bankruptcy Board of India (IBBI)

has approved his name, and if the appeal is allowed then Appellant can continue

only for another fifteen-days. For the said reason, we are not inclined to interfere

with the impugned order dated 10th May, 2018.

11. However, we make it clear that the impugned order dated 10th May, 2018

will not affect the career of the Appellant - Shravan Kumar Vishnoi, who may be

appointed as the 'Interim Resolution Professional' or 'Resolution Professional' in

Company Appeal (AT) (Insolvency) No. 253 of 2018 6

any other case. The appeal stands disposed of with the aforesaid observations.

No cost.

[Justice S.J. Mukhopadhaya] Chairperson

[ Justice Bansi Lal Bhat ] Member (Judicial)

/ns/gc

Company Appeal (AT) (Insolvency) No. 253 of 2018