If the conduct of CIRP was disapproved by the CoC, the Resolution Professional has no vested right of foisting himself on the CoC for his continuance – Diwan Chand Arya Vs. Government of Sikkim & Ors – NCLAT New Delhi

The impugned order came to be passed on the application filed under Section 22 of the IBC for replacement of Appellant(Resolution Professional) which was based on 4th CoC meeting. It emerges from the impugned order that the Appellant declined to place agenda of his replacement for voting before the CoC who after deliberation confirmed the replacement of the Resolution Professional and replaced him with another RP with 97.98% voting shares. NCLAT held that we find that the Power Department of Government of Sikkim being the major stakeholder had serious reservations about the conduct of the Appellant and disapproved of his behavior and action. The decision was taken to remove the Resolution Professional as the Committee of Creditors was not satisfied with the conduct of CIRP by him. It cannot be termed to be a case of casting any stigma on the conduct of the Appellant. If the conduct of CIRP was disapproved by the CoC and he lost their confidence, the Resolution Professional has no vested right of foisting himself on the CoC for his continuance. The removal having the requisite majority vote shares cannot be held to be flawed in any manner. Since there are no adverse observations against the Appellant alleging or attributing any misconduct to him, there is no occasion for expunging of any such remarks.

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