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TMI Blog2018 (12) TMI 1124X X X X Extracts X X X X X X X X Extracts X X X X ..... cation has been filed after expiry of the maximum period of CIRP as provided under Section 12 of the I&B Code, 2016, which is not falling within the purview of the provisions of the Code, and is not maintainable at the instance of the lenders. Applicants have filed the instant Application at the fag end of the CIR Process to replace the Resolution Professional who has already acquainted with the details of the business ventures, assets and other transactions of the Corporate Debtor. Therefore, the reasons given by the lenders for replacing the Resolution Professional and the procedure followed is not known to law. Moreover, it has also been noted by this Authority that the lenders have convened the meeting on 03.09.2018, which was not conducted in accordance with the provisions of the I&B Code, 2016. Conducting of the meetings of the CoCs is the responsibility of the Resolution Professional as and when required or deemed fit or at the request of any the CoCs members or any mandatory meeting warranted by the I&B Cade, 2016 and the Resolution Professional shall act as Chairman of such meetings. However, no such request was made by the CoCs to the Resolution Professional for co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... envisaged by the CoCs, (ix) wild allegations were made against the 3rd Applicant without addressing the key issues raised in various CoCs meetings, (x) the Resolution Professional has concentrated only in brining the Resolution Applicants inside the meeting of the CoCs for presenting the Resolution Plan, (xi) Resolution Professional has been arbitrarily taking suo motu action and seeking for confirmation from CoCs without discussing the pros and cons of the key issues raised in various meetings and (xii) without waiting for the outcome of forensic audit and scrutiny of special transactions under Sections 43, 45, 50 and 66 of the I B Code, 2016 has completed the preparation of Information Memorandum and invited the Resolution Applicants to present the Resolution Plan. In short, the Applicants alleged that the Resolution Professional viz., Mr. V. Nagarajan has committed various violations of the provisions of the I B Code, 2016 causing prejudice to the CoCs members which warranted the CoCs members to file the instant Application for his removal. However, it has been noted that the application on hand has been filed by lenders, not the CoCs. 3. The Resolution Professional viz. V. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ended from time to time whenever any changes i.e. any addition and deletion occurred in the assets or business of the Corporate Debtor or any termination of existing contracts by the customers. The Resolution Professional has contended that the Expression of Interest (EoI) was duly published after approval of the CoC members and in response to the said EoI , three prospective Resolution Applicants have expressed their interest and sought for to access the Information Memorandum and two of them have submitted the Resolution Plans which were scrutinised by the Resolution Professional and placed them before the CoCs for consideration. But, the CoCs refused to allow the Resolution Applicants to present the Resolution Plans before it. 6. The Resolution Professional has contended that the claim of the members of the CoCs with regard to findings likely to be mentioned in the Forensic Audit Report will impact the Information Memorandum is completely misconceived and completely wrong understanding of the I B Code, 2016. It has been submitted that the Information Memorandum should contain the financial position of the Corporate Debtor, all information relating to disputes by or against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive contractual arrangement (bottling operations) with PepsiCo India Holding Private Limited. But, M/s. PepsiCo has terminated the said contract in an arbitrary manner and without any valid cause during the CIRP period in violation of the contractual terms and the provisions contained in the I B Code, 2016. The said action of M/s. PepsiCo has not been challenged at any stage and the same caused the Corporate Debtor to run high and dry without any business to do on its own. Consequently, the Corporate Debtor suffered a huge loss and lost its concept of going concern . But, the CoCs did neither addressed the issue nor have given instructions to the RP to challenge the action of termination of the contract, which has been done by the Pepsico unilaterally. 11. It has also been placed on record by the Resolution Professional that at an earlier point of time the 3rd Applicant viz., ICICI Bank Limited has filed an Appeal before Hon ble NCLAT against his appointment which was dismissed. The same fact has been suppressed by the Applicants while filing the instant Application. The Resolution Professional has also explained that the allegations relating to the inclusion of the assets of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a liquidation order as referred to in sub-clauses (i), (ii) and (iii) of clause (b) of sub-section (1). (3) Where the resolution plan approved by the Adjudicating Authority is contravened by the concerned corporate debtor, any person other than the corporate debtor, whose interests are prejudicially affected by such contravention, may make an application to the Adjudicating Authority for a liquidation order as referred to in sub-clauses (i), (ii) and (iii) of clause (b) of sub-section (1). (4) On receipt of an application under sub-section (3), if the Adjudicating Authority determines that the corporate debtor has contravened the provisions of the resolution plan, it shall pass a liquidation order as referred to in sub-clauses (i), (ii) and (iii) of clause (b) of sub-section (1). (5) Subject to section 52, when a liquidation order has been passed, no suit or other legal proceeding shall be instituted by or against the corporate debtor: Provided that a suit or other legal proceeding may be instituted by the liquidator, on behalf of the corporate debtor, with the prior approval of the Adjudicating Authority. Appeal. Initiation of liquidation. 22 THE GAZETTE OF INDIA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver, the period of 98 days was not utilized due to the disagreement among the CoCs with regard to the appointment of Resolution Professional with requisite voting share due to which delay for a period of 89 days got caused in making the appointment of Resolution Professional. Therefore, vide Order dated 07.06.2018, the period of 98 days was subtracted from 270 days by granting extension of 90 days with the direction to the Resolution Professional to complete the CIR Process before the expiry of the time period and file the report to this Authority, as and when the Resolution Plan, if any, is approved by the CoCs. The extended period of time has also expired on 06.09.2018, and the lenders have filed the application on 6th of September, 2018. 17. Thus, the Applicants have filed the instant Application at the fag end of the CIR Process to replace the Resolution Professional who has already acquainted with the details of the business ventures, assets and other transactions of the Corporate Debtor. Therefore, the reasons given by the lenders for replacing the Resolution Professional and the procedure followed is not known to law. Moreover, it has also been noted by this Authority tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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