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TMI Blog2024 (11) TMI 481X X X X Extracts X X X X X X X X Extracts X X X X ..... vocates for R-1 JUDGMENT ASHOK BHUSHAN, J. This Appeal has been filed by Personal Guarantor of the Corporate Debtor challenging order dated 10.09.2024 passed by National Company Law Tribunal, New Delhi, Court-III in IA No.1904 of 2024 in IB - 775(ND)/2022. The Adjudicating Authority while passing order on application under Section 98 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the "IBC") has partly allowed application - IA No.1904 of 2024 filed by the Financial Creditor for replacement of Resolution Professional ("RP") - Mr. Prabhat Ranjan Singh. Prayer (B) made in the application was rejected. The Appellant aggrieved by the said order has come up in this Appeal. 2. Brief facts of the case necessary to be no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titled as Technology Development Board Vs. Mis Usha India Ltd. & Anr. before the Hon'ble High Court of Delhi. The Copy of the Order passed by the Hon'ble High Court of Delhi wherein Mr. Prabhat Ranjan Singh appeared as a counsel of Usha India Ltd in which the Petitioner is the director is attached herewith as ANNEXURE- R/3. 7. It is further respectfully submitted that Mr. Prabhat Ranjan Singh as Counsel of Usha India Ltd. also wrote a letter dated 20.12.2017 to the Retd. Justice Y.K. Singhal, Sole Arbitrator, New Delhi wherein Mr. Prabhat Ranjan Singh informed the Ld. Arbitrator that the Technology Development Board (Financial Creditor) had waived its right to file present arbitration proceedings as the creditor had already file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly eligible in terms of Regulation 4 of IBBI (Insolvency Resolution Process for Personal Guarantors of Corporate Debtors) Regulations, 2019. The RP is not an associate of the guarantor, nor related party. Hence, no eligibility is attached to Respondent No.2. It is submitted that RP has only extended legal services to the Personal Guarantor and there is no material to indicate that RP has given advice, direction or instruction to Personal Guarantor, who is accustomed to act accordingly. 5. Learned Counsel for the Respondent No.1 refuting the submissions of the Appellant submits that the RP, has been representing the Corporate Debtor of which the Appellant is a Personal Guarantor in arbitration arising out of the same debt and is not an inde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the RP being biased and having influence of the Personal Guarantor in the Personal Insolvency Resolution Process. Hence, in our considered view it can be a valid and reasonable ground to change or to replace the RP in the present matter." 6. The order impugned has been passed by the Adjudicating Authority under Section 98 of the IBC. Section 98 entitles both, debtor and creditor to apply to the Adjudicating Authority for replacement of RP appointed under Section 97. Section 98 of the IBC is as follows: "98. Replacement of resolution professional. - (1) Where the debtor or the creditor is of the opinion that the resolution professional appointed under section 97 is required to be replaced, he may apply to the Adjudicating Authority f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), the Adjudicating Authority shall pass an order appointing a new resolution professional. (8) The Adjudicating Authority may give directions to the resolution professional replaced under sub-section (7) - (a) to share all information with the new resolution professional in respect of the insolvency resolution process; and (b) to co-operate with the new resolution professional in such matters as may be required" 7. Application - IA No.1904 of 2024 was filed by the Financial Creditor under Section 98 for replacement of the RP. Section 98, sub-section (1) entitles both the debtor or the creditor to apply to the Adjudicating Authority for the replacement of such RP, where the debtor or creditor is of the opinion that RP appointed u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ersonally or through RP, hence, the said vested right cannot be taken away. Section 94, sub-section (1) of the IBC is as follows: "94. Application by debtor to initiate insolvency resolution process. - (1) A debtor who commits a default may apply, either personally or through a resolution professional, to the Adjudicating Authority for initiating the insolvency resolution process, by submitting an application." 9. Section 94, sub-section (1) is a provision, which permits a debtor to initiate insolvency resolution process. Thus, the debtor is fully entitled to initiate the insolvency resolution process, either personally or through RP. The Appellant, thus, was fully entitled to initiate the insolvency resolution process through RP, as wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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