9911796707
TMI Blog2020 (5) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... he was drawing excess salary which was being picked up on the basis that approval of Central Government was awaited and on two occasions, admittedly the excess drawn was returned - Being in managerial position, this may have happened in the Company (which is now stated to have gone in liquidation) because of being related party. The Appellant was related party as reflected from the minutes of COC meeting dated 26.04.2018 (Annexure - A of Reply) in Item No.9. The COC which includes the lead and other lenders did not approve and there is nothing to show that Central Government permitted payment of excess remuneration and when this is so, there appears to be no reason to find fault with the Impugned Order and we do not find any reason to inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99 and was re-designated Director Finance and Group Chief Financial Officer in 2005 and promoted as Executive Director Finance and Group CFO in 2008. He claimed that he was reappointed Executive Director Finance in 2013. The Appellant claimed that the amount paid as salary to the effect of ₹ 33,84,835/- for period 26.09.2013 to 30th June, 2014 had been recovered by the Corporate Debtor from him in November, 2017. He had been promoted as Joint Managing Director with 10% increase in salary which had been approved by lead lender State Bank of India. According to the Appellant, salary recommended by Nomination and Remuneration Committee of the Board was approved by AGM in September, 2016 but the same was not paid for period of June, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Respondent has referred to provisions of Section 197(1) of the Companies Act, 2013 to state that remuneration higher than the amount prescribed under the said Section required approval of the Central Government. According to the Respondent, the Corporate Debtor had earlier proceeded on the basis that Central Government would give the requisite approval under Section 197 of the Companies Act, paid the Appellant remuneration in excess of what was permissible under the said Act with effect from June, 2017. The same was shown in the books of accounts of Corporate Debtor as advance/recoverable from the Appellant. The Respondent has stated that on earlier occasion, the remuneration paid in excess to the Appellant, in anticipation of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and as appearing in the Reply filed by Resolution Professional. The Adjudicating Authority in Paragraphs 25 and 26 of the Impugned Order observed as under:- 25. With regard to the admission of claim of the Applicant for the period prior to CIRP, this Adjudicating Authority has found that the said excess remuneration to the Applicant was only on anticipation by the Applicant that the Lenders and Government would approve the same, but the Lenders have not approved the same. This Adjudicating Authority is not empowered to interfere the sanity of the decision of the Lead Banker with regard to the approval by the Lenders for managerial remuneration in excess of the prescribed limits for further approval by the Central Government for all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rescribed limits. Further, if any excess payments have been made by the Company to any managerial person, then such person is required to refund such payments to the Company. In the present case, no Central Government approval is available in connection with the abovementioned points. Accordingly, the Claim Amount (whether it relates to excess remuneration refunded by you or amounts withheld by the Company) is hereby rejected. 7. It is matter of record that COC dealt with the claim of the Appellant in meeting dated 26.04.2018 as well as 07.08.2018 but did not support the Appellant with regard to his claim for salary in excess of what is permissible under Section 197 of the Companies Act. The Appellant appears to have been aware that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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