Hon’ble High Court of Gujarat, in the case of Parthil Kamlesh Gondalia vs IDBI Trusteeship Services Ltd (SCA 10615 of 2025) and other, has dealt with important question of law under Section 97(3) Insolvency and Bankruptcy Code, 2016 (for short ‘IB Code’) regarding appointment of Resolution Professional in a case where the creditor himself has filed a petition under Section 95 of the IB Code.
It is the contention of Mr. Arjun Sheth learned advocate for the petitioner that appointment of Resolution Professional is not in consonance with the provision of Section 97(3) of the Insolvency and Bankruptcy Code, 2016 (for short ‘IB Code’). It is further contended that in view of provision of Section 97(3) of the IB Code, an appointment of Resolution Professional can only be done by the Insolvency and Bankruptcy Board of India (for short ‘the Board’) in a case where the creditor himself has filed a petition under Section 95 of the IB Code.
In the present case, the respondent No.1 is the creditor who approached the Hon’ble NCLT, Ahmedabad (Tribunal) under Section 95 of the IB Code with a recommendation of name of the Resolution Professional i.e. respondent No.2 herein. According to Mr. Sheth, in view of the provision of Section 97(3) of the IB Code, the Tribunal ought to have sent the name so recommended by the petitioner to the Board for its nomination and/or approval. Mr. Sheth submitted that the Tribunal, however, without sending the name of Resolution Professional to the Board, straightway, vide order dated 14.5.2025, appointed respondent No.2 in respect of the petitioner – personal guarantor.
Hon’ble High Court of Gujarat quashed and set aside the order dated 14.05.2025 passed by Hon’ble NCLT, Ahmedabad for appointment of Resolution Professional and remanded the proceedings back to the NCLT, Ahmedabad.
In view of above Hon’ble High Court of Gujarat has held that in case where the creditor himself has filed a petition under Section 95 of the IB Code, the appointment of Resolution Professional can only be done by the Insolvency and Bankruptcy Board of India