2022 (5) TMI 257 - AT - Insolvency and Bankruptcy

Seeking permission for withdrawal of petition - Section 12A of IBC - HELD THAT - The Admission of the Application under Section 9 of the I B Code, 2016 was passed only on 22nd December, 2021 and the Application under Rule 11 by the Operational Creditor to withdraw the Application was filed on 03rd January, 2022 and 04th January, 2022, Adjudicating Authority has passed an order on the Application that status quo regarding the CIRP be maintained. The Application was admitted on 22nd December, 2021 and on 04th January, 2022, the Adjudicating Authority after noticing the Application and submissions of the Learned Counsel for the Operational Creditor has directed the Status Quo, the IRP virtually effectively functioned only for 14 days. In view of the Status Quo order was not to function any further, it is held that the Order of the Adjudicating Authority directing the payment of fee and CIRP cost of Rs. 1,10,000/- in addition to Rs. 75,000/- was quite reasonable and does not warrant any interference. IRP has filed the Appeal only raising issue of fee whereas he had worked only for 14 days and the direction was issued for payment of fee of Rs. 1,10,000/- plus Rs. 75,000/- which is quite reasonable and appropriate - Appeal dismissed.

Summary

Issues:
1. Appeal against the Order allowing withdrawal of petition by Operational Creditor seeking Tribunal's permission.
2. Dispute over the fee paid to the Interim Resolution Professional (IRP).
3. Direction for payment of additional fee and costs to the IRP.
4. Adjudicating Authority's decision regarding the IRP's fee and the reasonableness of the same.

Analysis:
1. The appeal was filed against the Order permitting the withdrawal of the petition by the Operational Creditor, seeking the Tribunal's approval. The Adjudicating Authority allowed the application and directed payment of additional fees to the IRP, leading to the appeal by the IRP.

2. The IRP contended that the fee paid was inadequate considering the work done and no settlement occurred before the IRP, preventing the filing of an application under Section 12A. The Tribunal reviewed the submissions and the record, noting the timeline of events leading to the application for withdrawal.

3. The Adjudicating Authority's Order directed the payment of Rs. 1,10,000/- in addition to the Rs. 75,000/- already paid to the IRP. The Authority cited previous judgments to support the decision on fixing the IRP's fee. The Tribunal found the additional fee reasonable, given the circumstances and the limited duration of the IRP's involvement.

4. The Tribunal emphasized that insolvency proceedings are not solely about the IRP's fees and expenses but are consequential to the main proceedings. It concluded that the IRP's appeal focused excessively on fees and lacked substance. The Tribunal dismissed the appeal, affirming the Adjudicating Authority's decision on the fee payment and the overall handling of the case.