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2020 (10) TMI 1269 - Tri - Insolvency and BankruptcySeeking direction to Respondents to pay the outstanding professional fees and expenses incurred and paid by erstwhile IRP - Seeking direction to Respondents to pay the outstanding professional fees of PCS - Seeking direction to Respondents to pay the outstanding professional fees to counsel of the IRP-CA - HELD THAT - Admittedly, the Applicant is seeking direction upon the Respondent to pay professional fee of third party namely, Mr. Jignesh Shah, CS and Mr. Hiten Parekh, CA, who are neither the Applicant nor authorised to seek direction from the Adjudicating Authority to pay the professional fee. Under such circumstances, the application is had in the eye of law. Further, it is also a matter of record that ₹ 4,19,719/- is paid as Insurance Premium without the approval of COC, though the Applicant has enough time in his hand and now at this belated stage agitating the issue when the Resolution Plan is already approved by this Adjudicating Authority. Under such circumstances, when the COC has already been dissolved and RP has also been discharged from his duties, the claim so made by the Applicant is not maintainable - Application not maintainable and is dismissed.
Issues:
1. Claim for outstanding professional fees and expenses incurred by the IRP. 2. Dispute over deduction of professional fees. 3. Approval of expenses by the COC. 4. Allegations of exceeding authority by the IRP. 5. Justification for deduction of professional fees. 6. Maintainability of the application after COC dissolution. Analysis: Claim for Outstanding Professional Fees and Expenses: The application filed by the IRP sought directions for payment of outstanding professional fees and expenses incurred during the Corporate Insolvency Resolution Process (CIRP). The IRP highlighted the payments due to him and other professionals involved in the process, including a chartered accountant and a company secretary. The application detailed the duties performed by the IRP, such as convening meetings and handling the transition to the appointed RP. Dispute Over Deduction of Professional Fees: A dispute arose regarding the deduction of a significant amount from the IRP's professional fees, related to an insurance premium payment. The IRP contended that the deduction was wrongful and provided explanations regarding the circumstances leading to the deduction. The IRP argued that the deducted amount should be reimbursed as it was incurred during the course of his duties. Approval of Expenses by the COC: The application highlighted the approval of professional fees and expenses by the Committee of Creditors (COC) during various meetings. It detailed the resolutions passed by the COC regarding the payment of fees until the appointment of the RP. The IRP emphasized the importance of these approvals in the context of CIRP costs. Allegations of Exceeding Authority by the IRP: The Respondent raised concerns about the IRP exceeding his authority by incurring expenses without proper approval. Allegations were made regarding the IRP's decision-making process, including appointing agencies and committing expenses without COC authorization. The Respondent argued that such actions were beyond the IRP's scope of authority. Justification for Deduction of Professional Fees: The Respondent justified the deduction of professional fees by citing the IRP's alleged negligence and unauthorized actions. It was argued that the excess payment made without COC approval was a result of the IRP's delay and poor due diligence. The Respondent emphasized the importance of adhering to procedures and obtaining necessary approvals. Maintainability of the Application After COC Dissolution: The Respondent contended that the application became non-maintainable after the dissolution of the COC and the discharge of the RP. It was argued that the claims made by the Applicant were no longer valid once the Resolution Plan had been approved. The Respondent highlighted the timing of the application and the lack of bonafide claims as reasons for dismissing the application. In conclusion, the Tribunal dismissed the application, stating that it was not maintainable after the dissolution of the COC and the discharge of the RP. The judgment emphasized the importance of following proper procedures, obtaining approvals, and maintaining the integrity of the insolvency resolution process.
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