CoC Can Replace IRP with RP Under Section 22 IBC; IRP Has No Right to Appeal Without Stakeholder Status

The NCLAT held that the Committee of Creditors (CoC) has the authority under Section 22 of the IBC to replace the Interim Resolution Professional (IRP) with a Resolution Professional. Since the CoC replaced the IRP with a 100% vote share, exceeding the required 66%, the appellant IRP lacked any legal right to continue and had no locus standi to maintain the appeal. The IRP, not being a stakeholder, cannot claim infringement of legal rights. Additionally, the appellant could not challenge the constitution of the CoC, which he himself constituted. The appeal was dismissed for lack of merit.

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The National Company Law Appellate Tribunal (NCLAT) dismissed the appeal challenging the replacement of the Appellant Interim Resolution Professional (IRP) by Mr. Ankit Sinha as Resolution Professional (RP) with 100% Committee of Creditors (CoC) vote share. The core issue was the allegation that the CoC was related to the Corporate Debtor and acted collusively. The Tribunal held the appeal not maintainable, emphasizing that under Section 22 of the Insolvency and Bankruptcy Code, 2016 ("I&B Code"), the CoC has the authority to appoint or replace the IRP as RP. Post-amendment, the IRP continues until replaced by the CoC. Since the replacement was made with unanimous CoC approval (exceeding the requisite 66% vote), the Appellant lacked any vested legal interest or locus standi to challenge the decision. The Tribunal further noted that the Appellant, having constituted the CoC, could not impugn its constitution. In conclusion, the Tribunal found "no merit in this Appeal" and dismissed it.

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