2023 (8) TMI 708 - AT - Insolvency and Bankruptcy

Stay on CIRP process - Immediate restoration of Authorised Signatories in the accounts maintained by the Applicant in various banks, including the only operational account of Applicant with Yes Bank Limited as it existed prior to the Admission Order - removal of the name of the Interim Resolution Professional from the list of Authorised Signatories in the bank accounts of the Applicant - HELD THAT - Staying of the CIRP does not entitle the Corporate Debtor to put back in position which has already been held by this Appellate Tribunal in Ashok Kumar Tyagi s case 2022 (11) TMI 984 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI . Application filed by the Corporate Debtor cannot be allowed. Application is rejected accordingly.

Summary

Issues Involved:
The issues involved in the judgment are:
1. Application for restoration of authorized signatories in bank accounts and removal of Interim Resolution Professional.
2. Application for clarification by the Interim Resolution Professional.

Application for Restoration of Authorized Signatories and Removal of Interim Resolution Professional:
In this case, the Corporate Debtor filed an application seeking the restoration of its authorized signatories in bank accounts and the removal of the Interim Resolution Professional (IRP) from the list of authorized signatories. The Appellate Tribunal had earlier passed an interim order staying the Corporate Insolvency Resolution Process (CIRP) but directed that the Corporate Debtor cannot alienate its assets during this period.

The Corporate Debtor relied on a previous judgment of the Tribunal in "Ashok Kumar Tyagi vs. UCO Bank & Anr." where it was held that even if the CIRP order is stayed, the Corporate Debtor cannot be put back to its previous position. The Tribunal emphasized that merely staying the CIRP does not entitle the Corporate Debtor to resume its previous functions. The Tribunal rejected the application filed by the Corporate Debtor for restoration of authorized signatories, stating that the conditions set in the previous case cannot be applied in the present situation.

Application for Clarification by Interim Resolution Professional:
Another application was filed by the Interim Resolution Professional (IRP) seeking clarification in light of the stay on the CIRP process. The Tribunal clarified that due to the stay, the IRP is not allowed to proceed further in the CIRP process. However, the IRP is directed to ensure that the Corporate Debtor continues to operate as a going concern.

In conclusion, the Tribunal disposed of the application filed by the IRP with the observation that the IRP should maintain the Corporate Debtor as a going concern during the stay on the CIRP process.