# In the matter of Sumat Kumar Gupta Vs. Committee of Creditors of M/s Vallabh Textiles Company Ltd. Company Appeal (AT)(Insolvency)No.1037 of 2022

> NCLAT judgment dated 2 Sept 2022. Citation: TCN-2022-NCLAT-00238. The appeal challenges an order by the Adjudicating Authority (NCLT, Chandigarh Bench) that…

- **Court:** NCLAT
- **Order date:** 2 Sept 2022
- **Citation:** TCN-2022-NCLAT-00238
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/sumat-kumar-gupta-vs-committee-of-creditors-of-ms-vallabh-textiles-company-ltd-c-262404e3

## Summary

### Background

The appeal challenges an order by the Adjudicating Authority (NCLT, Chandigarh Bench) that allowed the Financial Creditor's application to replace the Resolution Professional (Appellant) and appointed a new Resolution Professional, Mr. Rajiv Khurana. The Appellant contends that the replacement order was passed without providing an opportunity for hearing, violating principles of natural justice.

## Facts

The Appellant, Sumat Kumar Gupta, an Insolvency Professional and formerly the Resolution Professional for M/S Vallabh Textiles Company Ltd., filed an appeal against an order dated July 11, 2022. This order was issued 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. The impugned order allowed an application by the Punjab National Bank, the Financial Creditor, for the replacement of the Resolution Professional.

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## Issues and analysis

### Issue 1: Whether the **Adjudicating Authority** is required to provide an opportunity of hearing to the…

**Ratio:** The replacement of a **Resolution Professional** is complete when the **Committee of…

**Reasoning:** The **NCLAT** reasoned that the scheme of **Section 27 of the I&B Code** does not…

**Interpretation:** The **NCLAT** interpreted **Section 27 of the I&B Code** to mean that the…

**Application:** Applying this interpretation, the **NCLAT** found that since the **Committee of…

## Parties

- **Judges:** Ashok Bh…; M. Satyanarayana…; +1 more
- **Advocates:** Rajang Th…; Surekha T…; +2 more

## Timeline

- **June 4, 2022 — CoC Meeting and…**: The **Committee of Creditors (CoC)**, in its meeting, decided with 100% vote to replace…
- **July 11, 2022 — Adjudicating Authority…**: The **Adjudicating Authority** (National Company Law Tribunal), Chandigarh Bench, passed…

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