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TMI Blog2022 (4) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... h he has so far performed and now supposedly performing by virtue of the interim order passed by the Hon'ble NCLAT. There are also fault with the Resolution Professional for not convening the meeting of the members of the COC for over a year without any valid reason. If permission of this Adjudicating Authority for convening the meeting of the COC is the requirement, then nothing prevented the RP from seeking permission from this Adjudicating Authority. In fact, at no stage, the RP has informed the members of COC that unless the permission of the Tribunal is obtained, he will not be able to convene the meetings of the members of the COC - the said plea is nothing but an afterthought. In fact, when this Adjudicating Authority has not accorded approval to the Resolution Plan, it was the bounden duty of the RP to call for the meeting of the COC in order to discuss further course of action, which the RP has failed. The RP is hereby directed to forthwith convene a meeting of the Members of the COC - COC shall finalise its Agenda for the proposed meeting having regard to the fact of pendency of Appeal No. 325 of 2021, before the Hon'ble NCLAT, Chennai. Application allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dication. During this interregnum, the RP has been running the Corporate Debtor as a going concern, pursuant to the specific direction by Hon'ble, NCLAT, Chennai Bench. 4. It is stated that the applicant issued various emails requesting the RP to provide monthly cash flow statements for the period from March 2018 to August 2019, CIRP expenses, reasons for increase in expenditure, status of forensic audit, financial statements for the year 2019-20, expenses for the financial year 2020-21 etc. Copies of emails sent by the Applicant are filed as Annexure-2, 3 4 at page Nos. 16 to 27 of the application. As per the provisions of Section 20(10) of IBC, the Resolution Professional shall make available any financial information as required by the COC within a period of 7 days of such requisition, however, the RP has violated the same. 5. In the 4th COC meeting, the Applicant along with other COC members have raised issues in the financial statements and conduct a forensic audit but RP tried to convince the COC members to avoid a Forensic Audit citing frivolous reason. In the 5th meeting, majority of COC members have resolved for conducting the forensic audit of the corporate de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irous of continuing the RP as the Liquidator in case the Corporate Debtor is ordered to be liquidated in this case. The Applicant requested the Adjudicating Authority to replace the RP and also to convene a meeting of the COC to enable the stakeholders to decide the way forward in the CIRP/Liquidation of the Corporate Debtor. 11. It is pertinent to mention that IBBI issued an Order dated 20.04.2019 against the RP, regarding the conduct of the Respondent in the course of conducting the CIRP of the Corporate Debtor. 3. The gist of the Respondent's brief is- i. It is denied that the claim of applicant that he is representing the COC and filed the present application on behalf of the other COC members. It is stated that it is false and there is no such document authorizing the applicant to represent the other members of the COC. ii. The application is liable to be dismissed as applicant is seeking a direction to convene the COC which is non-existence as on today by virtue of the order passed by this Adjudicating Authority vide order dated 01.09.2021 rejecting the successful resolution plan approved by the COC and putting an end to the CIRP process of the Corporate Debto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in 5th COC meeting was revised and the RP is not to conduct the Forensic Audit for revised scope. In this connection, a Joint Lender Meeting has been convened in which M/s. GT has been appointed as Forensic Auditor (Annexure-IV). Accordingly, RP has been obtained legal opinion about the Forensic Auditor, in which, it is stated that the Joint Lenders cannot appoint Forensic Auditor. viii. Since the 330 days CIRP period is over, convening of the COC meeting needs approval from the Adjudicating Authority. It is stated that IBC Code did not provide for conducting of Forensic Audit for a period of about 10 years prior to commencement of CIRP, as such, the action of the petitioner is outside the purview. ix. The Petitioner has filed a complaint No. BGJD/AR/FY22/068, dated 19.04.2021 on the same subject of forensic audit with IBBI against RP and the same is pending. Right from the beginning, the petitioner is harassing the RP in different ways. It is stated that for the same cause of action, multiple remedies are not to be permitted and this IA needs to be dismissed. x. Order of IBBI dated 20.04.2019 imposing penalty on RP is concerned, it is not on the conduct of the RP but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted for the revised scope . It is stated that the RP on his own sent an email dated 27.03.2019 i.e. after the end of CIRP period to finalise the scope of work of forensic auditor and within next few days he changed his stand stating that the revised scope of work cannot be put up for voting now. This is totally an afterthought on the part of the RP. v. It is stated that on 11.01.2022, the RP has issued an email to the applicant and other members of the COC that he obtained a legal opinion and that a forensic auditor appointment at this stage can be done only on the direction of the Hon'ble NCLT/NCLAT, which is also marked to the ex-promoters of the corporate debtor. It reflects the RP is colluding with the ex-promoter(s) of the corporate debtor. In response, the applicant issued an email dated 13.01.2022. Copies of the emails dated 11.01.2022 and 13.01.2022 between the applicant and the RP are filed as Annexure-5 (colly.) of the rejoinder. vi. It is stated that order of the Hon'ble NCLAT dated 17.12.2021 will not come in the way of the COC to discuss and replace the RP by another RP and also stated that the COC being an interested stakeholder is concerned about th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 of 2018 wherein the Resolution passed by the COC for conducting of Forensic Audit has been approved, the directions were not carried out. A copy of the Legal Notice dated 19.03.2021 has also been filed. 8. Ld. Counsel further stated that after 18th COC meeting held on 11.03.2019 and 12.03.2019, the RP has not convened any meeting despite repeated requests of the members of the COC, dated 26.05.2021 whereunder the COC intended to deliberate on the future course of action and the email dated 23.11.2021 requesting the RP to convene a meeting of the COC to discuss the way forward and renewal of bank guarantee furnished, by CFM ARC but the requests of the applicant deliberately fallen on the deaf ears of the RP. The said emails are filed as Annexures-6 7. 9. Learned Counsel for the petitioner further submitted that not only total non-cooperation but also defiance in implementing the decisions of COC, non-convening of the meetings of the members of the COC despite repeated requests and passing of over one year time since the last meeting of the members of the COC by the RP, being apparent on the face of the record placed before this Tribunal, the COC was compelled to seek direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat apart, the RP is also answerable to the COC for all his acts and actions under IBC, which he has so far performed and now supposedly performing by virtue of the interim order passed by the Hon'ble NCLAT, supra. Moreover, the order of this Tribunal dated 01.09.2021, rejecting the approval of the resolution plan approved by the COC, has been under challenge before the Hon'ble NCLAT, Chennai Bench, and the said Appeal is pending. In this back drop, we hold that the CoC, in the present case, has neither became extinct nor functus officio, especially as the resolution process has not come to an end. 13. We, also find fault with the Resolution Professional for not convening the meeting of the members of the COC for over a year without any valid reason. If permission of this Adjudicating Authority for convening the meeting of the COC is the requirement, then nothing prevented the RP from seeking permission from this Adjudicating Authority. In fact, at no stage, the RP has informed the members of COC that unless the permission of the Tribunal is obtained, he will not be able to convene the meetings of the members of the COC. Thus, the said plea is nothing but an afterthought ..... X X X X Extracts X X X X X X X X Extracts X X X X
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