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TMI Blog2022 (11) TMI 957X X X X Extracts X X X X X X X X Extracts X X X X ..... the Applicant himself. Thus the mere fact that Applicants in Applications under Section 7, 9 and 10 as well as in Section 94 and 95 provides details of Insolvency Resolution Professional/Resolution Professional by the Applicant himself, no bias can be read into the said procedure. The Scheme of IBC is such that IRP/RP plays a pivotal role in Insolvency Resolution Process. Thus we are not satisfied that the mere fact that Resolution Professional has been recommended by the Applicant, he shall have bias in favour of the Application filed by him and he shall always submit a report of admitting the Application any bias has to be read in the scheme. The RP is to perform his function and duties as per the IBC and the Rules which castes duty on the Resolution Professional to act in accordance with Insolvency and Bankruptcy Code, 2016, Rules and Regulations framed thereunder. There are no substance in the submissions of Learned Counsel for the Appellant that Resolution Professional recommended by the Applicant is biased and appointment of Mr. Sunil Kumar Kabra is bad in law - appeal dismissed. - Company Appeal (AT) (Insolvency) No. 774 of 2022 Company Appeal (AT) (Insolvency) No. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of application. The RP, as suggested by the Applicant, Mr. Sunil Kumar Kabra, is directed to file report within one month. Matter to appear on 14.09.2021. Meanwhile, Parties are directed to complete their respective pleadings/submissions on E-portal within seven(7) days, if already not uploaded. 4. The Appeal challenging the Order dated 19th July, 2021 has been filed on 15th May, 2022. Notice was issued by this Tribunal on 25th July, 2022 in respect to which Reply has been filed on behalf of Respondent Bank. 5. Learned Sr. Counsel for the Appellant challenging the Impugned Orders passed in these two Appeals submits that Application for Personal Insolvency was filed by the Creditor-State Bank of India and not by the Resolution Professional. It is submitted that the Application which has been filed in Form-C under Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 (hereinafter referred to as Rules, 2019 ) indicate that the Application has been filed by the Creditor-State Bank of India and not by the Resolution Professional. Learned Counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was filed through RP since the Respondent Bank has specifically filled the details of the RP under Part-IV of the Form-C. There was no need to follow the procedure for appointment of RP under sub-section 3 and 4 of Section 97, admitting that there was some defect in the Form-C that the RP has not signed Part-IV the same was only procedural defect which is curable. Further when the RP has submitted its Consent Form before the Adjudicating Authority, the defect, if any, stand cured and there was no reason to interfere with the Impugned Order on the above submission. 7. Learned Counsel for both the parties have placed reliance on certain judgements of this Tribunal and Hon ble Supreme Court which shall be referred to while considering the submissions in detail. 8. Before we consider the rival submissions raised by Learned Counsel for the parties, it is useful to refer to the statutory provisions of IBC occurring in Chapter-III of the Code. Section 95 deals with Application by Creditor to initiate Insolvency Resolution Process. Section 95(1) is as follows: 95. Application by creditor to initiate insolvency resolution process.-(1) A creditor may apply either by himself, or jo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-Section (3) and sub-section (4) of Section 97 covers a situation where application is filed under Section 94 or 95 by debtor or creditor himself in which case the Board within seven days is to nominate a Resolution Professional. Under sub-section (1) and (2) of Section 97, the Board is to confirm that there are no disciplinary proceedings pending whereas under sub-section (3) and (4) of Section 97 the Board is to nominate a Resolution Professional. When sub-section (1) and (2) is contrasted with sub-section (3) and (4) of Section 97 it is clear that purpose and object of both the above provisions are different. Confirmation is asked for from the Board of the Resolution Professional whether there is any disciplinary proceeding pending or not and under sub-section (3) and (4) nomination is to be made since the Application is filed by debtor or creditor himself. 12. The Rules have been framed namely Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 where Rule 7 deals with Application by creditor. Rule 7(2) provides as follows: 7(2) The application under sub-section (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclose that I am currently serving as an interim resolution professional/resolution professional / authorized representative / liquidator / bankruptcy trustee in [insert number and details of the proceedings]; certify that there are no disciplinary proceedings pending against me with the Board or [name of the insolvency professional agency he is a member of]: affirm that I am eligible to be appointed as a resolution professional in respect of the guarantor in accordance with the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019; make the following disclosures in accordance with the code of conduct for insolvency professionals as set out in the Insolvency and Bankruptcy Board of India (Insolvency Professional) Regulations, 2016 [insert disclosures, if any]. (Signature of the insolvency professional) [Name of the creditor] has paid the requisite fee for this application through [state means of payment] on [date]. Yours sincerely, Signature of creditor/person authorized to act on behalf of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India, there are no signatures of the Resolution Professional. For considering the above, submissions, it is necessary to extract Part-IV of Application filed by the State Bank of India in the present case. Which is at page 44 and 45 of the Appeal Paper Book: Part-IV PARTICULARS OF DECLARATION BY INSOLVENCY PROFESSIONAL (IF APPLICATION FILED THROUGH INSOLVENCY PROFESSIONAL) 1. Title and full name Sunil Kumar Kabra 2. Address Present Permanent Business C-805 Ofira Building, Opp.- Swar Shangini, V.I.P. Road, Bharthana, Vesu, Surat M-19-20-21 Metro Tower, Ring Road, Surat-395002 3. Email address (es) [email protected], [email protected] 4. Contact Number Home Mobile Business 9909959959 5. Declarati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omplex, Opp. V.S. Hospital, Ellisbridge Ahmedabad - 380006 (Emphasis Supplied) 18. Part-IV of the Application being filled up, the conclusion is irresistible that Application was filed through Resolution Professional. The last line of Part-IV which is in Bracketed Form A copy of written communication from the proposed interim resolution professional is annexed herewith and marked as Exhibit: Q . Thus the Application filed by the State Bank of India in Part- IV although does not appear that RP has made his signature but Application is accompanied by communication for the proposed Interim Resolution Professional as Annexure Q which indicates that the written communication is from the Resolution Professional which was annexed as Annexure Q. Thus, the Part-IV cannot be read to mean in the present case that there is no consent of the Resolution Professional. Part-IV not containing the signature of the Resolution Professional and containing the written communication at best is a minor irregularity/defect which cannot have any adverse effect since the written communication given by the Resolution Professional was p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Professional there is violation of Rules, 2019 and Regulations, 2019 fatally affecting the Application under Section 95(1). 21. Learned Counsel for the Appellant has relied on Judgement of this Tribunal in Pologix Infrastructure Private Limited Vs. ICICI Bank Limited [Company Appeal (AT) Ins. No. 30, 37, 54 of 2017] . In the above case, this Tribunal had occasion to consider a case where there was difference of opinion between two members of the Adjudicating Authority hence the matter was referred to the Third Member who held the application maintainable as the power of attorney was given in favour of the Legal Manager to initiate proceedings before the NCLT. In the above context, the Adjudicating Authority admitted Section 7 Application which was challenged before this Tribunal. This tribunal however in the said case has observed that if there is any defect in the name and address and position of the authorized representative the Application cannot be rejected and the Applicant is to be granted seven days time to produce the Board Resolution and remove the defect. It is useful to reproduce paragraph 37 and 38 of the Judgement. 37. As per Entry 5 6 (Part I) of Form No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lution Professional under the Regulations while giving consent and the statement required to be made in Form C‟ provided in the Rules. The Rules show that the IBBI follows a procedure of maintaining a panel of Insolvency Professionals with information about disciplinary proceedings against them from time to time. Under the Regulations relating to Resolution Professionals various safeguards have been provided and the Resolution Professionals are creatures of IBC read with Rules and Regulations and subject to discipline through IBBI. As mentioned the legislature has confidence in the Resolution Professionals under the system that they will act as Professionals in terms of IBC, its Rules and Regulations. IBC provides that the Creditor may, himself or through Resolution Professional file application under Section 95. Section 97 of IBC does not bar the same Resolution Professional from being appointed as Resolution Professional by the Adjudicating Authority. The safeguard for the Debtor is in Section 98 where the Debtor may seek replacement of the Resolution Professional. Thus, we are not accepting the fear expressed by the Appellant that how could the Resolution Professional app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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