2018 (11) TMI 1942 - AT - Insolvency and Bankruptcy

Resolution professional seeking withdrawal of application under Section 12A of the I B Code - Whether RP can move such withdrawal application? - HELD THAT - The resolution professional cannot file an application for withdrawal of an application under Section 7 or 9 or 10 of the I B Code. As per Section 12A, it is the applicant who can only file such an application for withdrawal on which the Adjudicating Authority may pass an appropriate order - Therefore, the application for withdrawal can be filed only by the applicant, who initially filed application under Section 7 or 9. Regulation 30A cannot over-ride the substantive provisions of Section 12A according to which the applicant can only move application for withdrawal of the application before the Adjudicating Authority and not by the resolution professional . Therefore, if the application for withdrawal is filed by the applicant in the present case, in such case the Adjudicating Authority will decide the case in accordance with the provisions of Section 12A - Post the matter for orders on 11th December, 2018 to report the development.

Summary

Issues:
1. Whether the resolution professional can file an application for withdrawal under Section 12A of the I&B Code?
2. Interpretation of Regulation 30A of the 'Insolvency and Bankruptcy Board of India (Insolvency Regulation Process for Corporate Persons) Regulations, 2016' in relation to the resolution professional's authority to move the application for withdrawal.

Analysis:
1. The judgment delves into the issue of whether the resolution professional has the authority to file an application for withdrawal under Section 12A of the I&B Code. The Tribunal highlighted that Section 12A explicitly states that only the applicant who initially filed the application under Section 7 or 9 can move such an application for withdrawal. It was emphasized that the resolution professional does not possess the legal standing to initiate the withdrawal process under the mentioned sections of the I&B Code. The Tribunal stressed the importance of adhering to the statutory provisions and the clear language of the law in determining the eligibility to file for withdrawal.

2. The Tribunal also examined Regulation 30A of the 'Insolvency and Bankruptcy Board of India (Insolvency Regulation Process for Corporate Persons) Regulations, 2016' to ascertain the resolution professional's role in the withdrawal process. While Regulation 30A outlines a procedure for the resolution professional to submit the withdrawal application to the Adjudicating Authority upon approval by the committee, the Tribunal asserted that this regulation cannot supersede the substantive provisions of Section 12A. The judgment emphasized that the applicant, as defined under the I&B Code, retains the exclusive right to seek withdrawal of the application before the Adjudicating Authority. Therefore, the Tribunal concluded that the resolution professional's involvement in the withdrawal process is limited by the statutory framework provided in Section 12A.

In conclusion, the judgment clarifies that under the I&B Code, the resolution professional does not possess the authority to independently file an application for withdrawal under Section 12A. The exclusive right to seek withdrawal lies with the applicant who initially submitted the application under Section 7 or 9. The Tribunal underscored the significance of upholding the statutory provisions and directed the matter to be scheduled for further orders to monitor the case's progression in accordance with Section 12A.