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TMI Blog2021 (10) TMI 1181X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 31 of the Code and Regulations 36A, 36B, 37, 38 and 39. Payment to Operational Creditors (Existing) - HELD THAT:- As the treatment of operational creditors is entirely different under the Act of 2016 and regulations thereunder, and as such there is no provision to clear the existing operational creditors during CIRP, appropriate directions are required on this aspect - the RP is directed to look into hiring new suppliers or service providers, if needed, for the purpose of completion of the project as directed by this Authority vide order dated 25.11.2020 and the cost of the same shall be included in CIRP cost. Further, the treatment of the existing operational creditors be done according to Section 53 of the Code. Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esentative. In view of the same, the RP is granted waiver from complying with these provisions. Section 31 of the Code and Regulations 36A, 36B, 37, 38 and 39 - HELD THAT:- Since this is a case of reverse CIRP where this Authority has already directed the CIRP to get the project completed on priority basis, repay the loan of Financial Creditor and handover the possession of flats to respective allottees and homebuyers and make efforts to sell the flats which are not booked. For the same, the RP has been directed to obtain finances from 3 mechanisms i.e., promoters or Financial Creditor or 3rd party private lender. Therefore, the RP is not required to perform the above functions and so this requirement may be waived - In the present cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Corporate Persons) Regulation, 2016; b. Directions in relation to treatment of claims of the existing operational creditors; and c. Pass such further order/orders as this Authority may deem fit and proper in the facts and circumstances of the instant case and to sub serve the ends of justice. 2. It is stated that the application for Corporate Insolvency Resolution Process ('CIRP') of the Corporate Debtor was filed by AU Small Finance Bank Limited ('Financial Creditor') under Section 7 of the Code and the same was admitted by this Adjudicating Authority vide order dated 25.11.2020. The Applicant was appointed as the Interim Resolution Professional ('IRP') and was directed to take over affairs of the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required under law and accordingly the Applicant has filed an application under Section 19(2) of the Code. 6. The Applicant further states that he has been facing dilemma in relation to the compliances as envisaged under the Code and Regulations made thereunder, as to whether they are to be performed or not in the present case of reverse CIRP which is a novel approach being adopted in relation to real estate projects. In view of this, the Applicant seeks clarification/waivers in the form of directions and settle the law and mechanism in respect of reverse CIRP for future instances. 7. Moreover, the Applicant stated that 3-4 operational creditors have submitted their claims in respect of goods supplied and services provided for the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suppliers or service providers, if needed, for the purpose of completion of the project as directed by this Authority vide order dated 25.11.2020 and the cost of the same shall be included in CIRP cost. Further, the treatment of the existing operational creditors be done according to Section 53 of the Code. b. Section 25 (2) (c), (g), (h) (i) of the Act of 2016 and Regulation 27 of the Regulations of 2016: The purpose of valuation is estimation of fair value and liquidation value, which is shared with CoC after obtaining an undertaking for and the same is used by CoC while evaluating the Resolution Plan as the Resolution Plan value should not be less than Liquidation value. Since it is a case of Reverse CIRP, the same is not re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e CIRP. Also, in this case the members of CoC are Allottees/Home Buyers represented by Authorized Representative (AR) besides secured lender and the NDA for the same is to be taken from each of the CoC members. Now the ambiguity arises, whether the NDA is to be obtained from AR on behalf of all the allottees or it is to be obtained from all the allottees individually. In case AR submits NDA, whether he can share with individual allottees, and that too with or without NDA from them? During normal CIRP, IM is prepared for the purpose of formulating a Resolution Plan in respect of the Corporate Debtor but in the present case since the CIRP is project specific, there is no need for a Resolution Plan. However, the relevant information with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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