NCLAT: Only CoC Can Appoint Liquidator; NCLT Can Replace RP

The NCLAT held that only the Committee of Creditors has the authority to appoint a liquidator when the Resolution Professional does not agree to continue, and that the NCLT cannot appoint a liquidator of its own choice.

The tribunal clarified that the Adjudicating Authority’s role is limited to replacing the RP. while the CoC must select the liquidator in accordance with the IBC. It added that judicial intervention cannot override the commercial wisdom of creditors.

The ruling came in appeals filed by Omkara Asset Reconstruction Company challenging the NCLT’s appointment of a liquidator.

[Omkara Asset Reconstruction Co Ltd v. RP & Ors.]