2019 (2) TMI 263 - Tri - Insolvency and Bankruptcy

Appointment of Interim Resolution Professional - refund of amount to corporate debtor - Initiation of corporate insolvency resolution process - Held that - Appellant has brought to our notice the different bills to show that he has incurred expense - The Adjudicating Authority has failed to notice the aforesaid fact. This apart, once it was agreed by the corporate debtor to pay the amount of ₹ 3,80,000/- being satisfied and having paid the amount, the Adjudicating Authority was wrong in passing order to refund the amount of ₹ 1,80,000 to corporate debtor - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Appeal against order passed by Adjudicating Authority
2. Determination of expenses and fees incurred by Interim Resolution Professional
3. Direction to refund balance amount to corporate debtor
4. Discrepancy in the amount paid by corporate debtor and the direction to refund
5. Submission of composite invoice by Resolution Professional
6. Decision to set aside the impugned order

Analysis:

1. The appeal was filed against the order passed by the Adjudicating Authority, which directed the Interim Resolution Professional (IRP) to refund a portion of the amount received from the corporate debtor. The appeal was based on the contention that the Adjudicating Authority erred in ordering the refund.

2. The Adjudicating Authority had determined the expenses and fees incurred by the IRP during the Corporate Insolvency Resolution Process (CIRP). The Authority scrutinized the expenses and work done by the IRP and allowed a total payment of only ?2,00,000 against the total expenses and fees incurred, ordering a refund of ?1,80,000 to the corporate debtor.

3. The appellant argued that the corporate debtor had already paid the amount of ?3,80,000 to the IRP, and it was agreed upon by both parties. Therefore, the direction to refund a portion of this amount was unjustified, especially considering the expenses incurred by the IRP.

4. The Adjudicating Authority failed to consider the bills provided by the appellant to demonstrate the expenses incurred. The appellant highlighted the discrepancy between the amount paid by the corporate debtor and the direction to refund a portion of it, emphasizing that the corporate debtor had already fulfilled its payment obligations.

5. It was noted that a composite invoice of ?6,80,000 was submitted by the Resolution Professional, but the Professional agreed not to make any further claims beyond the ?3,80,000 already received towards expenses and fees.

6. In light of the submissions and reasons presented by both parties, the Tribunal decided to set aside the impugned order dated 5th September 2018 and allowed the appeal, without imposing any costs.

This comprehensive analysis covers the key issues raised in the judgment, providing a detailed understanding of the legal proceedings and decisions made by the Tribunal.