2018 (9) TMI 2052 - Tri - Insolvency and Bankruptcy

Seeking appointment of replaced RP Mr. Sandeep Mahajan in place of the earlier RP Mr. Mohan Lal Jain - HELD THAT - The application which has already been filed on the basis of resolution dated 05.09.2018 is under consideration and we do not feel the necessity of waiting for the CoC to grant locus standi to any other person or identity afresh other than the RP. The necessity in these matters is to decide the issue expeditiously as the speed is the essence of CIR Process. The requirement of Section 27 stands satisfied - Application allowed.

Summary

Issues:
1. Application for appointing a new Resolution Professional (RP) in place of the existing RP.
2. Validity of the resolution passed by the Committee of Creditors (CoC) for the replacement of RP.
3. Opposition to the application based on subsequent developments and modifications in the resolution.
4. Consideration of the necessity to wait for CoC's ratification for filing the application.
5. Compliance with the requirements of Section 27 of the Insolvency and Bankruptcy Code, 2016.

Analysis:
1. The Tribunal considered an application seeking the appointment of a new RP, Mr. Sandeep Mahajan, in place of the current RP, Mr. Mohan Lal Jain, for a Corporate Debtor. The application was supported by a resolution passed by 98.74% voting share of the CoC on 05.09.2018, in accordance with Section 27 of the IBC, 2016. The resolution aimed to replace the existing RP with Mr. Sandeep Mahajan, and the CoC's consent was obtained for this change.

2. The Respondent's counsel opposed the application, citing subsequent developments where the resolution dated 05.09.2018 was modified on 10.09.2018. The modification involved Canara Bank filing the application instead of the RP for the change of RP. Additionally, it was mentioned that the resolution dated 10.09.2018 was subject to ratification by the CoC in a subsequent meeting. Despite these developments, the Tribunal proceeded with the consideration of the application based on the original resolution passed on 05.09.2018.

3. The Tribunal emphasized the need for expeditious decision-making in Corporate Insolvency Resolution (CIR) processes, stating that speed is essential. Therefore, the Tribunal decided not to wait for CoC's ratification for filing the application and entertained the application filed by the RP. The Tribunal found that the requirement of Section 27 was satisfied, leading to the allowance of the application and the appointment of Mr. Sandeep Mahajan as the new RP, replacing Mr. Mohan Lal Jain.

4. The Tribunal disposed of the case, CA-869(PB)/2018, after appointing Mr. Sandeep Mahajan as the RP based on the resolution passed by the CoC on 05.09.2018. The judgment highlighted the importance of timely decision-making in insolvency matters and the significance of complying with the statutory provisions of the Insolvency and Bankruptcy Code, 2016.