The National Company Law Appellate Tribunal (NCLAT) on Tuesday upheld the order of NCLT, directing removal of the resolution professional (RP)of Shree Ram Urban Infrastructure Ltd.
The appellate tribunal also directed the Insolvency and Bankruptcy Board of India to conduct an enquiry against the RP and take appropriate steps in accordance with the law.
A two-member NCLAT bench comprising Justices Rakesh Kumar and Shreesha Merla said the NCLT was “well within its jurisdiction” to pass an order for the removal of the RP, particularly in a situation where he had not taken any steps to convene a meeting of the Committee of Creditors (CoC).
The NCLAT observed that the Corporate Insolvency Resolution Process (CIRP) was initiated against Shree Ram Urban Infrastructure Ltd (SRUIL) on November 06, 2019, and the first CoC meeting was conducted after more than one-and-a-half years on April 19, 2021.
NCLT “has categorically observed that the RP has ‘miserably failed to adhere to the timelines stipulated in the Code,” said the appellate tribunal.
The Mumbai bench of the National Company Law Tribunal (NCLT) had on November 11, 2022 directed removal of Srigopal Choudary as the resolution professional of Shree Ram Urban Infrastructure with a direction to hand over all records/documents to the newly appointed Sapan Mohan Garg.
This order was challenged before the NCLAT.
“We consider that it is a fit case in which a direction can be issued to IBBI to conduct an inquiry regarding the conduct of the appellant. Accordingly, IBBI is directed to conduct an in-depth enquiry in respect of the conduct of the appellant and take appropriate steps in accordance with the law,” said NCLAT.
It had directed a copy of this order to be communicated to the chairperson of IBBI.