9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (8) TMI 107 - AT - Insolvency and BankruptcyFixing the fee of IRP - direction to Appellant to file her Claim before the Liquidator as the Corporate Debtor was under Liquidation, is correct or not - fee of an RP falls under the definition of a Claim as defined under the Code or not - Whether the fee of a Resolution Professional is required to be fixed by CoC, failing which such decisions/determination is to be made by the Adjudicating Authority under the provisions of Section 60(5) of the Code read with Regulation 33(2) of the CIRP Regulation to fix the fees as payable to the RP? HELD THAT - This Tribunal is of the considered view that the question which mainly arises in this Appeal is whether the Liquidator is having the jurisdiction to decide the fee of the RP as the CoC is no longer in existence. By virtue of Section 5(13)(e) of the Code, the fees and expenses incurred by the Appellant comes under the ambit of Insolvency Resolution Process Cost and therefore in the instant matter the Liquidator cannot adjudicate upon the Insolvency Resolution Process Cost. Regulation 34 of the IBBI Regulations specifies that the CoC shall fix the expenses which are incurred by the Resolution Professional. The word expenses includes the fee to be paid to the Resolution Professional. Viewed from any angle, the fees of an RP cannot be considered to be a Claim as defined under Section 3(6) of the Code. The Liquidator can only verify and adjudicate the Claims as defined under the Code. Since the amount of fees payable to an RP is not a Claim , the same cannot be determined or verified by Liquidator. The Hon ble Supreme Court in Alok Kaushik 2021 (3) TMI 1242 - SUPREME COURT in para 20 has clearly distinguished the fees to be paid to a professional from the penalty which can be imposed if a disciplinary committee is satisfied that sufficient cause exists . The Hon ble Apex Court has observed that the availability of a grievance redressal mechanism under the Code against an Insolvency professional does not divest the Adjudicating Authority of its jurisdiction under Section 60(5)(e) of the Code to consider the amount payable to the Appellant - the contention of the Respondent that there is a nexus between the IBBI Report and the fees to be paid to the RP, is untenable. The Adjudicating Authority shall take into consideration the facts of the attendant case together with the orders of this Tribunal, by which Order, the RP had continued performing her duties and decide the fees as expeditiously as practicable but not later than 4 weeks from the date of this Order and shall proceed in accordance with law - thus, it is Adjudicating Authority which has to decide fees in the absence of a CoC and the RP cannot be directed to prefer a Claim before the Liquidator. The matter is remanded back to the Learned Adjudicating Authority - Appeal allowed by way of remand.
Issues Involved:
1. Whether the Adjudicating Authority was justified in directing the Appellant to file her 'Claim' before the Liquidator as the 'Corporate Debtor' was under Liquidation. 2. Whether the fee of an RP falls under the definition of a 'Claim' as defined under the Code. 3. Whether the fee of a Resolution Professional is required to be fixed by CoC, failing which such decisions/determination is to be made by the Adjudicating Authority under the provisions of Section 60(5) of the Code read with Regulation 33(2) of the CIRP Regulation to fix the fees as payable to the RP. Issue-Wise Detailed Analysis: 1. Whether the Adjudicating Authority was justified in directing the Appellant to file her 'Claim' before the Liquidator as the 'Corporate Debtor' was under Liquidation: The Appellant, erstwhile Resolution Professional (RP) of 'M/s. Shilpi Cables Technologies Limited' (Corporate Debtor), contested the direction by the Adjudicating Authority to file her 'Claim' before the Liquidator. The Appellant argued that the Liquidator does not have the power to decide the fees of the IRP and RP, which should be determined by the Adjudicating Authority. The Tribunal noted that the Adjudicating Authority had previously directed the CoC to fix the fee of the RP within two weeks, but no decision was taken before the Corporate Debtor went into Liquidation. The Tribunal concluded that the Liquidator cannot adjudicate upon the Insolvency Resolution Process Cost, and it is the Adjudicating Authority that should decide the fees in the absence of a CoC. 2. Whether the fee of an RP falls under the definition of a 'Claim' as defined under the Code: The Tribunal emphasized that the fees and expenses incurred by the Appellant fall under the ambit of Insolvency Resolution Process Cost as per Section 5(13)(e) of the Code. Regulation 34 of the IBBI Regulations specifies that the CoC shall fix the expenses incurred by the Resolution Professional, which includes the fee to be paid to the RP. The Tribunal concluded that the fees of an RP cannot be considered a 'Claim' as defined under Section 3(6) of the Code. Therefore, the Liquidator does not have the jurisdiction to verify or adjudicate the fees of the RP. 3. Whether the fee of a Resolution Professional is required to be fixed by CoC, failing which such decisions/determination is to be made by the Adjudicating Authority under the provisions of Section 60(5) of the Code read with Regulation 33(2) of the CIRP Regulation to fix the fees as payable to the RP: The Tribunal referred to the judgment of the Hon'ble Supreme Court in 'Alok Kaushik' Vs. 'Mrs. Bhuvaneshwari Ramanathan & Ors.', which clarified that the Adjudicating Authority has the jurisdiction to make a determination on the fees of professionals appointed by the RP. The Tribunal observed that since the CoC did not fix the fees of the RP and the Corporate Debtor went into Liquidation, the Adjudicating Authority should decide the fees payable to the RP under Section 60(5) of the Code read with Regulation 33(2) of the CIRP Regulations. The Tribunal directed the Adjudicating Authority to decide the fees as expeditiously as practicable but not later than four weeks from the date of the Order. Conclusion: The Tribunal allowed the Appeal, set aside the Impugned Order, and remanded the matter back to the Adjudicating Authority to decide the fees payable to the Resolution Professional. The Tribunal reiterated that the RP's fees are not a 'Claim' and should be determined by the Adjudicating Authority in the absence of a CoC.
|
