Alpha Ltd. has initiated proceedings against Tara Ltd., for recovery of debt of ₹ 4.32 crore. Alpha intends to appoint Deepak Garg, one of the employees of its statutory auditors, M/s Shyam and Associates (Chartered Acco

Pursuant to Regulation 3 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, an insolvency professional shall be eligible to be appointed as an interim resolution professional or a resolution professional, as the case may be, for a corporate insolvency resolution process of a corporate debtor if he, and all partners and directors of the insolvency professional entity of which he is a partner or director, are independent of the corporate debtor. Further, it is provided that a person shall be considered independent of the corporate debtor, if, in the last three financial years, he is not an employee or proprietor or a partner: of a firm of auditors or secretarial auditors in practice or cost auditors of the corporate debtor; or of a legal or a consulting firm, that has or had any transaction with the corporate debtor amounting to five per cent or more of the gross turnover of such firm, In view of the above mentioned provisions, Deepak Garg being one of the employees of statutory auditors of the debtor company is not independent of the debtor and as such his appointment as Resolution Professional is not valid.