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TMI Blog2022 (5) TMI 492X X X X Extracts X X X X X X X X Extracts X X X X ..... so been ratified by the CoC in its seventh meeting as per Agenda item No. 10 and the pending matter in issue is with respect to professional fee of the Resolution Professional for the lockdown period from 25.03.2020 to 31.07.2020 and for the period from 11.03.2021(post liquidation resolution) till the disposal IA No.294/2021 - the fee of the resolution professional must be commensurate to and be reasonable compensation of the amount of work involved,including all other expenses such as counsel fees and out of pocket expenses considering the continuous involvement of the Resolution Professional and post liquidation resolution litigation carried on for the purpose of better management of assets of Corporate debtor. Application allowed. - IA Nos. 294/2021 & 35/2022 In CP (IB) No. 167/Chd/Hry/2019 - - - Dated:- 9-5-2022 - Hon ble Mr. Harnam Singh Thakur, Member (Judicial) And Hon ble Mr. Subrata Kumar Dash, Member (Technical) For the applicant-Resolution Professional in IA Nos. 294/2021 35/2022 :1). Mr. Ajay Kumar Jain, Resolution Professional in person 2). Mr. Sourit Arora, Advocate For the respondent-sole COC Member in Punjab National Bank in IA Nos. 294/2021 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Form G for inviting Expression of Interest (EoI) in view of the availability of one asset of the corporate debtor and valuation report thereof also. 7. It is further submitted that in the aforesaid meeting, the CoC member i.e. Punjab National Bank as a Sole CoC member having 100% voting rights, discussed the matter and observed that since the registered office of the corporate debtor is in locked and sealed condition for last many years by Dena Bank and Canara Bank (non lenders) and as on date there is no assets of the corporate debtor available, except one industrial plot at RICCO, Alwar (Rajashthan), so seeking further extension of 60 days for CIRP period will not serve the purpose. 8. The CoC member further observed that there is no guarantee that the records and other assets of the corporate debtor would be made available to the RP within next 60 days due to non-cooperation by the suspended directors and the pendency of the applications before the Adjudicating Authority against them, and also pendency of the criminal case before the special court by the IBBI against the suspended directors, so further extension of CIRP period will not be viable for the CoC member. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to liquidate the corporate debtor, any time after its constitution under sub-section (1) of Section 21 and before the confirmation of the resolution plan, including at any time before the preparation of the information memorandum.] 12. A bare perusal of the provisions shows that there are three circumstances under which the liquidation order can be passed by the Adjudicating Authority:- i. before the expiry of the Insolvency Resolution Process period; ii. Maximum period permitted for completion of the Corporate Insolvency Resolution Process under Section 12 or the fast track Corporate Insolvency Resolution Process under Section 56 as the case may be; and iii. If does not receive a resolution plan under sub-section (6) of Section 30. 13. We have carefully considered the submissions made in the application by the Resolution Professional and have also perused the records. 14. The Liquidator s Fee shall be structured in the manner mentioned herein below: a. In case the security interest is relinquished to Liquidation Estatethe Liquidator s Fees shall be 50% of rates of Liquidator s Fees provided under Regulation 4(2) of IBBI (Liquidation Process) Regul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trol of the assets, property of the Corporate Debtor with immediate effect and made a public announcement clearly stating that the Corporate Debtor is under Liquidation in terms of Regulation 12 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016; viii. The Provision of Section 33 (5), (6) and (7) of the IBC, 2016 shall have come into force with immediate effect. The Order of Moratorium passed under Section 14 of the Insolvency and Bankruptcy Code, 2016 shall cease to have its effect and a fresh Moratorium under Section 33(5) of the Insolvency and Bankruptcy Code shall commence; ix. This Order shall be deemed to be a notice of discharge to the officers, employees and the workmen of the corporate debtor as per Section 33(7) of the Insolvency and Bankruptcy Code, 2016; x. The Liquidator shall submit a Preliminary Report to the Adjudicating Authority within seventy-five (75) days from the Liquidation commencement date as per Regulation 13 of the Insolvency and Bankruptcy (Liquidation Process) Regulations, 2016; xi. The Liquidator shall file regular progress reports as per Regulation 15 of the Insolvency and Bankruptcy (Liquid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pertaining to lockdown period from 25.03.2020 to 31.07.2020, which is over and above 9 months of CIRP as per the revised bill dated 05.03.2021 for Rs. 1,50,000/- and direction to sole CoC members to pay Rs. 20,000/- towards legal cost of this application to RP. 2. It is submitted that the RP was appointed as an IRP by this adjudicating authority in pursuance to the order dated 06.02.2020. The sole member Committee of Creditors (CoC) i.e. Punjab National Bank having hundred percent voting right in its first meeting held on 06.03.2020 passed a resolution under agenda item No.11 for appointment of Mr. Ajay Kumar Jain/applicant from Interim Resolution Professional to Resolution Professional. 3. It is further submitted by the applicant that in the aforesaid first CoC meeting, the sole CoC member i.e. PNB after discussion with the IRP and Zonal Office also fixed the fee of IRP/RP as Rs. 3,00,000/- keeping in mind CIRP period as 6 months during discussion (Average fee @ Rs.50,000/- per month). 4. It is contended on behalf of the applicant that the RP performed various work of CIRP since 06.02.2020 which have been elaborated in the 1st to 9th Progress Report dated 16.03.2021 an w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idered view that CIRP fees has already been approved by the CoC in its first meeting dated 06.03.2020 as per Agenda item No.10 and expenses incurred by the Resolution Professional during the period from 29.01.2021 to 05.03.2021 have also been ratified by the CoC in its seventh meeting as per Agenda item No. 10 and the pending matter in issue is with respect to professional fee of the Resolution Professional for the lockdown period from 25.03.2020 to 31.07.2020 and for the period from 11.03.2021(post liquidation resolution) till the disposal IA No.294/2021. 9. In the light of above facts and circumstances, we holds that the fee of the resolution professional must be commensurate to and be reasonable compensation of the amount of work involved,including all other expenses such as counsel fees and out of pocket expenses considering the continuous involvement of the Resolution Professional and post liquidation resolution litigation carried on for the purpose of better management of assets of Corporate debtor. The CoC is directed to pay the CIRP fees and expenses from the period of 11.03.2021 till 09.05.2022 after considering the bills for the expenses carried out and the miscellaneo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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