Tribunal Appoints Mr. Gupta to Lead CIRP Transition Process, Reviews Outgoing Professional's Fees

The Tribunal appointed Mr. Gupta as the new Resolution Professional, directing him to assume responsibilities and transition processes. The decision focused on maintaining the Corporate Insolvency Resolution Process (CIRP) continuity and addressing concerns over the actions of the outgoing Resolution Professional. The Tribunal also instructed the reconstituted Committee of Creditors to evaluate the fees of the outgoing Resolution Professional in their initial meeting post-replacement.

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Issues:
Appointment of Resolution Professional under Section 27(3) of Insolvency and Bankruptcy Code, 2016.

Analysis:
The application sought the replacement of the current Resolution Professional, Mr. Khushvinder Singhal, with Mr. Vijay Kumar Gupta. The Corporate Insolvency Resolution Process (CIRP) against the debtor was initiated based on an application by an operational creditor. Mr. Singhal was appointed as the Interim Resolution Professional (IRP) by the Tribunal. After the formation of the Committee of Creditors (CoC) and subsequent meetings, a resolution was passed to replace Mr. Singhal with Mr. Gupta as the Resolution Professional. The applicant alleged that actions taken by the current Resolution Professional post the application filing were unauthorized and aimed at increasing costs. The respondents did not object to the replacement but requested payment of fees and expenses incurred by the outgoing Resolution Professional.

The Tribunal considered the submissions, including the expenses incurred by the outgoing Resolution Professional, and relied on relevant judgments to make a determination. It was observed that the Adjudicating Authority has the power to decide the payable amount in the CIRP process and must assess the reasonableness of fees paid to the Resolution Professional. Referring to a previous order, the Tribunal directed the CoC to pay the expenses of the outgoing IRP. Ultimately, the Tribunal decided to appoint Mr. Gupta as the new Resolution Professional, instructing him to take charge of all records and assets, file necessary documents, and provide regular progress reports. The reconstituted CoC was tasked with evaluating the fees of the outgoing Resolution Professional in their first meeting after the replacement.

In conclusion, the Tribunal disposed of the application by appointing Mr. Gupta as the new Resolution Professional, outlining specific directions for the transition process and ongoing responsibilities. The decision aimed to ensure a smooth continuation of the CIRP while addressing the concerns raised regarding the actions of the outgoing Resolution Professional.

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