2020 (8) TMI 682 - SCH - Insolvency and Bankruptcy

Eligibility for appointment of Resolution Professional - A person who remained in the service of SBI and getting pension - HELD THAT - The approach of NCLAT is not correct that merely Resolution Professional who remained in the Service of SBI and is getting pension, was disentitled to be Resolution Professional. Let new Resolution Professional be appointed by the NCLT forthwith within a week in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016 - The change of Resolution Professional shall not reflect adversely upon the integrity of concerned Resolution Professional, who has been replaced. Appeal disposed off.

Summary

Issues Involved:
Appointment of Resolution Professional under the Insolvency and Bankruptcy Code, 2016.

Analysis:
The Supreme Court, comprising Hon'ble Mr. Justice Arun Mishra, Hon'ble Mr. Justice B.R. Gavai, and Hon'ble Mr. Justice Krishna Murari, addressed the issue of the appointment of a Resolution Professional under the Insolvency and Bankruptcy Code, 2016. The Court expressed dissatisfaction with the approach taken by the National Company Law Appellate Tribunal (NCLAT) in disqualifying a Resolution Professional solely based on their association with a particular entity and receiving pension benefits. The Court noted that the NCLAT's approach was not correct. However, considering the agreement of both parties' counsels, the Court directed the appointment of a new Resolution Professional by the National Company Law Tribunal (NCLT) within a week, in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016.

The Supreme Court emphasized that the replacement of the Resolution Professional should not cast any doubt on the integrity of the professional being replaced. The Court clarified that the change in Resolution Professional should not be viewed as reflecting negatively on the professionalism or conduct of the individual being substituted. Additionally, the Court ruled that the impugned order, which was found to be incorrect in its approach, should not be considered as setting a precedent for future cases. Consequently, the civil appeal was disposed of by the Supreme Court, providing clarity on the correct procedure for appointing Resolution Professionals under the Insolvency and Bankruptcy framework.