# In the matter of Central Bank of India vs. Sumatichand Gouti Jewellers Pvt. Ltd.

> NCLT judgment dated 2024-08-05. Citation: TCN-2024-NCLT-00879. The case involves an application filed by the Insolvency Resolution Professional (IRP) seeking…

- **Court:** NCLT
- **Order date:** 5 Aug 2024
- **Citation:** TCN-2024-NCLT-00879
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-sumatichand-gouti-jewellers-pvt-ltd-046c3547

## Summary

### Background

The case involves an application filed by the Insolvency Resolution Professional (IRP) seeking directions from the National Company Law Tribunal (NCLT). The order admitting the Corporate Debtor into the Corporate Insolvency Resolution Process (CIRP) was passed on June 21, 2024. However, the authorization for assignment (AFA) of the initial IRP was suspended on December 4, 2023. Consequently, the IRP filed the present application based on instructions from the Committee of Creditors (CoC) for a replacement.

## Facts

The Central Bank of India initiated a CIRP against Sumatichand Gouti Jewellers Private Limited. The CIRP was admitted on 2024-06-21. The AFA of the initial Insolvency Resolution Professional (IRP) was suspended on 2023-12-04. The IRP filed an application (I.A. 3670/2024) seeking directions from the NCLT regarding the steps to be taken. The Committee of Creditors (CoC) held a meeting on 2024-08-03 and resolved to pay the initial IRP Rs. 3 lakhs per month and appoint M/s Renascence Insolvency Resolution Professionals Private Limited as the new Resolution Professional. The CoC consists of Union Bank of India, Bank of India, and Central Bank of India, and the resolutions were approved with 100% voting. The application was filed under Section 7 of the IBC, 2016.

## Issues and analysis

### Issue 1: Whether the application filed by the Insolvency Resolution Professional seeking directions should …

**Ratio:** The NCLT has the power to issue directions to the IRP to ensure the smooth functioning of

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**Reasoning:** The IRP's AFA was suspended, necessitating the appointment of a new RP. The CoC has

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**Interpretation:** The NCLT interprets its powers under the IBC to include the ability to provide

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**Application:** The NCLT applied its power to direct the IRP by allowing the application and

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## Parties

- **Judges:** LAKSHMI G…; SH. CHARANJEET…
- **Appellants:** Central Bank of…
- **Respondents:** Sumati Chand…
- **Advocates:** Geeta Tor…

## Timeline

- **2023-12-04 — Suspension…**: The authorization for assignment (AFA) of the Insolvency Resolution Professional was…
- **2024-06-21 — CIRP Admi…**: The order admitting the Corporate Debtor into the Corporate Insolvency Resolution Process…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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