TaxTMI 
TaxTMI 
2022 (11) TMI 957
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....Code, 2016 (hereinafter referred to as "The Code") by the State Bank of India against the Appellant-the Personal Guarantor directed for commencement of the Interim Moratorium and appointed Mr. Sunil Kumar Kabra as the Resolution Professional (RP) to file report within one month. Company Appeal (AT) Ins. No. 781 of 2022 has been filed against the Order dated 17th August, 2021 passed in CP(IB) No. 76(AHM)2021, by which Order, the Adjudicating Authority directed for commencement of moratorium and directed Mr. Sunil Kumar Kabra as suggested by the Applicant to file Report within 10 days. 3. It shall be sufficient to notice facts in Company Appeal (AT) Ins. No. 774 of 2022 to decide both the Appeals. The application under Section 95 dated 15th April, 2021 has been filed by the State Bank of India to initiate Insolvency Resolution Process in respect of Appellant under the Code. The Appellant in the Application was referred to as a Guarantor to loan availed by M/s. Shirpur Power Private Limited-the Original Borrower. In the Application under Section 95(1), the Order dated 19th July, 2021 was passed by the Adjudicating Authority which is to the following effect: "The instant application....
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....iled as per Regulation 4(2) of Rules, 2019 but the consent Form-A is contemplated only when the Application is not filed by the RP and is filed by the Creditor. Language of Section 97 of the Code requiring confirmation of the RP by the Board and nomination by Board is mandatory in nature. Nomination of RP by the Board has for a particular purpose and object. It is submitted that when an Application is filed by/through Resolution Professional it is difficult to presume that he would recommend the rejection of the Application filed by himself. The RP becomes interested person in his own Application and become judge in his own case which is not permissible in law. Apprehension of bias is sufficient cause to not appoint Mr. Sunil Kumar Kabra as a RP when appointment of RP is bad in law all consequential steps are bad in law. 6. Learned Counsel for the Respondent refuting the submissions of Learned Sr. Counsel for the Appellant submits that this Appeal has been filed with delay and latches. It is submitted that the Impugned Order is passed on 19th July, 2021 whereas the Appeal has been filed after ten months on 15th May, 2022. On 19th July, 2021 when Order was passed, Learned Counsel f....
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....ng either- (a) confirming the appointment of the resolution professional; or (b) rejecting the appointment of the resolution professional and nominating another resolution professional for the insolvency resolution process. (3) Where an application under section 94 or 95 is filed by the debtor or the creditor himself, as the case may be, and not through the resolution professional, the Adjudicating Authority shall direct the Board, within seven days of the filing of such application, to nominate a resolution professional for the insolvency resolution process. (4) The Board shall nominate a resolution professional within ten days of receiving the direction issued by the Adjudicating Authority under subsection (3). (5) The Adjudicating Authority shall by order appoint the resolution professional recommended under subsection (2) or as nominated by the Board under subsection (4). (6) A resolution professional appointed by the Adjudicating Authority under sub-section (5) shall be provided a copy of the application for insolvency resolution process." 10. Section 97(1) and 97(2) covers a contingency when Application under Section 94 or 95 is filed through Resolution Pr....
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....: "PARTICULARS OF & DECLARATION BY INSOLVENCY PROFESSIONAL (IF APPLICATION FILED THROUGH INSOLVENCY PROFESSIONAL) 1. Title and full name 2. Address Present Permanent Business 3. Email address (es) 4. Contact Number Home Mobile Business 5. Declaration by insolvency professional I, [name of insolvency professional], an insolvency professional enrolled with [name of insolvency professional agency] having registration number [registration number] have been proposed as the resolution professional by [name of applicant guarantor] in connection with the proposed insolvency resolution process of [name of the guarantor]. I hereby: (i) agree to accept appointment as the resolution professional if an order of appointment is passed by the Adjudicating Authority; * state that the registration number allotted to me by the Board is [insert registration number] and that I am currently qualified to practice as an insolvency professional; * disclose that I am currently serving as an interim resolution professional/resolution professional / authorized representative / liquidator ....
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....umns which are mentioned are columns for name of creditor, signature of the Creditor, Name in block letters and Address of person signing, both for Application filed by the Creditor through Resolution Professional and by Creditor himself. The above columns had to be filled up. The difference to find out whether the Application filed by the Resolution Professional or Creditor himself is the difference with regard to the filing of Part-IV. When Part-IV is not filled up in an Application, Application is clearly by Creditor himself but when Part-IV is filled up, Application is not by the Creditor himself but through Resolution Professional. A harmonious reading of the Rules, 2019 read with Form C leads to above conclusion. 17. Learned Counsel for the Appellant has much emphasized in the Application which has been filed in Form C by the State Bank of 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 APPLICATIO....
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....lication is being submitted on behalf of the creditor] ....... Name in block letters Mr. NITIN K. CHAUHAN Address of person signing State Bank of India Stressed Assets Management Branch, 2nd Floor, Paramsiddhi Complex, 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 Profe....
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....nd purpose both of signature and giving written consent is same and we do not find any substance in submission of Learned Counsel for the Appellant that due to non-signature of the Resolution 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 gra....
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....tion Professional and such Resolution Professional cannot himself propose rejection of the application. We have already referred to the declaration which is sought from the Resolution 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 wh....