TaxTMI 
TaxTMI 
2022 (9) TMI 174
X X X X Extracts X X X X
X X X X Extracts X X X X
....d Mr. Mohak Sharma , Advocates ORDER Heard learned counsel for the Appellant and Shri Abhishek Anand appearing for the Respondent. This Appeal has been filed against the order dated 11.07.2022 passed by the Adjudicating Authority (National Company Law Tribunal), Chandigarh Bench in I.A. No. 682 of 2022 in CP(IB) No. 391/Chd/Pb/2018 by which order the application filed by the Punjab National Bank - the Financial Creditor for replacement of the Resolution Professional has been allowed and in place of the Appellant one Mr. Rajiv Khurana has been appointed as Resolution Professional. Aggrieved by the impugned order, the Appellant has come up in this Appeal. 2. Learned counsel for the Resolution Professional submits that the Adjudicating Aut....
X X X X Extracts X X X X
X X X X Extracts X X X X
....5. Section 27 of the I&B Code which provides for replacement of Resolution Professional by the CoC is as follows:- "27. Replacement of Resolution Professionals by Committee of Creditors.- (1) Where, at any time during the corporate insolvency resolution process, the committee of creditors is of the opinion that a resolution professional appointed under section 22 is required to be replaced, it may replace him with another resolution professional in the manner provided under this section. 2[(2) The committee of creditors may, at a meeting, by a vote of sixty-six per cent. of voting shares, resolve to replace the resolution professional appointed under section 22 with another resolution professional, subject to a written consent from the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ot contemplate any opportunity of hearing to the Resolution Professionals be given by the Adjudicating Authority before approving the proposal of new Resolution Professional. Section 27 requires the CoC to forward the name of proposed Resolution Professional to the Adjudicating Authority and the Adjudicating Authority is required to forward the name of the proposed Resolution Professional to the Board for its confirmation. The scheme of Section 27 does not indicate that Resolution Profession is to be made party and is to be issued notice before taking decision to appoint another Resolution Professional. Looking to the purpose and object of the I&B Code, where timeline is the essential factor to be taken into consideration at all stages, the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... perverse or without jurisdiction. The 'Committee of Creditors' with majority voting share of 88% having decided to replace 'Mr. Kiran Shah', he cannot function as 'Resolution Professional', though he will be entitled to his fee and cost, if any, incurred by him in terms of the 'I&B Code'." 9. Further, second judgment relied by learned counsel for the Respondent is judgment of this Tribunal in "Company Appeal (AT) (Ins.) No. 497 of 2020, Bank of India vs. Nithin Nutritions Pvt. Ltd.", where after noticing the scheme of Section 27, this Tribunal has made following observations in Para 6 of the judgment:- "6. In both the above provisions, the law nowhere says that the COC is required to give reasons. This appears to be also right. The rea....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... "Therefore, invoking of Section 27 and adopting a protracted procedure in that regard, as appears to have been done by the Adjudicating Authority, is unwarranted. This only has resulted in wastage of time and prolonging the CIRP Process. In the face of CoC resolution passed with more than the requisite majority, it cannot lie in the mouth of IRP that any of his legal rights have been infringed. It would have been wise on his part to bow to the commercial wisdom of the Committee of Creditors and quit gracefully. Be that as it may, there was no merit in the case set up by IRP before the Adjudicating Authority and the same was required to be dealt with without insisting upon filing of affidavit by the IRP in regard to the provision of law in....