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TMI Blog2022 (11) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... he Stakeholders Consultation Committee and necessary directions for further actions were being obtained by the liquidator. It thus becomes quite clear that compliance of regulations 2(ea), 2-A, 21-A and 37 of the Liquidation Process Regulations and Section 52/53 of the IBC are absolutely necessary even if the secured creditor proceeds to realise its security interest. The liquidator has carried out his responsibility with due diligence and without any prejudice to Appellant or any other stakeholder, and therefore, cannot be held responsible for delay that has taken place in pursuing the liquidation of the corporate debtor - the Adjudicating Authority has not committed any error in excluding period from 30.11.2018 to 24.2.2020 from the liquidation process for calculation of liquidator s fees slab under Regulation 4 of the Liquidation Process Regulations - Appeal dismissed. - Company Appeal ( AT ) ( Insolvency ) No. 1027 of 2021 - - - Dated:- 2-11-2022 - ( Justice Rakesh Kumar Jain ) Member ( Judicial ) And ( Dr. Alok Srivastava ) Member ( Technical ) For the Applicant : Mr. S. S. Ahluwalia and Mr. Mohit Bargwal , Advocates For the Respondent : Mr. Pardeep Dahiya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property as Rs. 3.60 crores on 8.3.2019 but Respondent on some pretext or the other did not hand over possession of the property to the Appellant to enable it to realise its security interest. 4. The Appellant has, therefore, stated there was a delay in carrying forward the liquidation process which was due to the liquidator, and hence the period from 30.11.2018 to 24.2.2020 is on account of the liquidator and therefore this period of approximately 15 months should not be excluded from the liquidation process for calculating the slab of liquidator s fee. 5. The issue that arises for consideration in the present appeal is that whether the period from 30.11.2018 to 24.2.2020, which is the period when various issues arose in the liquidation process, particularly in relation to the HSIIDC Bawal property in which the Appellant has security interest, and whether the liquidator is responsible for this delay. 6. We heard the argument of the Learned Counsels for both the parties and perused the record. 7. The Learned Counsel for Appellant has submitted that the only issue he is aggrieved by the Impugned Order relating to point No. 3 which is about inclusion of 15 months period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tention the list of dates and events filed by the liquidator vide Dy. No. 34149 dated 8.3.2022, to show how the liquidator has been diligent and careful about following the process of liquidation, and in particular, the disposal of HSIIDC Bawal Property, but due to multiple issues being raised by SIDBI from time to time he had to approach the NCLT after due discussions in the Stakeholders Consultation Committee for necessary directions to carry the liquidation process forward. Elaborating on the events, he has submitted that after the Appellant had informed him that it intended to realize its security interest in the property at HSIIDC Bawal on 30.11.2018 he sent an e-mail on 27.2.2019 apprising the Appellant that in order to realize its security interest in terms of section 52 of the IBC, the Appellant has to intimate the price at which it proposes to realize the secured asset in terms of regulation 37 of the Liquidation Process Regulations. He has argued that reminder the Appellant intimated the reserve price as Rs. 3.60 crores on 8.3.2019 whereafter the liquidator asked for an undertaking from the Appellant that it would provide the property to the buyer in case a person willing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IRP and liquidation process costs which was not forthcoming, and therefore he again filed IA No. 3570 of 2020 seeking reliefs relating to CIRP and liquidation costs as per section 53 of IBC and Regulations 42 and 2A of Liquidation Process Regulations, whereupon vide the impugned order dated 10.8.2021 came to be passed by the Adjudicating Authority and aggrieved by the said order, in particular the issue about exclusion of 15 months period the Appellant has filed this appeal, which deserves to be rejected. 11. The Learned Counsel for Respondent/Liquidator has further referred to the order dated 20.7.2020 passed by the Adjudicating Authority in IA NO. 433/ND/2017 that SIDBI had not paid its share of the liquidator s fee and the estimated liquidation cost which should have been done within 90 days of the liquidation commencement date as is required under Regulation 212-A of the Liquidation Process Regulations and had rather requested clarifications on various items of the amount estimated and claimed by the liquidator. He has lastly referred to the order of this tribunal in CA AT (Ins) No. 151 of 2022, whereby the Hon ble Tribunal has held that Regulations 2(ea), 2-A, 21-A and 37 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at which it proposes to realize the security interest. 13. We reproduce the relevant portion of Regulation 37 of the Liquidation Process Regulations, 2016 hereunder for better appreciation of the matter:- 37. Realization of security interest by secured creditor. (1) A secured creditor who seeks to realize its security interest under section 52 shall intimate the liquidator of the price at which he proposes to realize its secured asset. (2) The liquidator shall inform the secured creditor within twenty one days of receipt of the intimation under sub-regulation (1) if a person is willing to buy the secured asset before the expiry of thirty days from the date of intimation under sub-regulation (1), at a price higher than the price intimated under sub-regulation (1). xx xx xx xx xx 14. After receipt of this e-mail, SIDBI communicated to the liquidator the estimated price of Rs. 3.60 crores at which it wished to realize its security interest in HSIIDC Bawal Property vide e-mail dated 8.3.2019. 15. We now examine the contention of the Learned Counsel for liquidator that SIDBI could not understand and/or interpret Regulation 21-A, which is regarding presu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Quite obviously this was not done by the appellant as is evident from the order dated 8.7.2020 in CA No.135/2019 by which the Appellant was directed at a much later date to pay its share of liquidation fees and cost after detailed calculations have been provided to it by the liquidator. 17. We also look at the issue of the liquidator seeking an undertaking from the Appellant. A perusal of the e-mail sent by the liquidator dated 9.3.2019 asking for an undertaking prior to release of secured asset, namely, HSIIDC Bawal property and a reminder e-mail dated 18.3.2019 (attached at pp.68-69 of the reply of liquidator), makes it clear that the undertaking was sought by the liquidator only in keeping with the requirement of Liquidation Process Regulations regarding SIDBI s acceptance to sell said property to the person who is willing to buy secured assets at a price higher than of the price of Rs. 3.60 crores, who may be identified by the liquidator, and also for depositing the excess amount over and above its claim amount within 15 days from the date of undertaking. It is clear from record that the Appellant did not provide such an undertaking and the issue of undertaking was resolved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vide order dated 16.3.2022, has held as follows:- 6. .. In so far as the payment of Liquidator s Fee in in paragraph 13 as noted above, Adjudicating Authority has disposed of the application with the direction to make payment of Liquidator s Fee and ensure compliance of Regulations 2(ea), 2A, 21A, 37 of the Liquidation Regulations and Section 52/53 of the Code. The order passed by the Adjudicating Authority does not warrant any interference. What was directed was as per Liquidation Regulation 21A as extracted in Paragraph 10 of the Judgment from which it is clear, even if the secured creditor proceeds to realise its security interest it is liable to pay fee as contemplated under regulation 21A (20(a). the Adjudicating authority has only directed the Applicant to follow the regulations as noted in paragraph 13. 21. It thus becomes quite clear that compliance of regulations 2(ea), 2-A, 21-A and 37 of the Liquidation Process Regulations and Section 52/53 of the IBC are absolutely necessary even if the secured creditor proceeds to realise its security interest. 22. We thus, find that the liquidator has carried out his responsibility with due diligence and without any prej ..... X X X X Extracts X X X X X X X X Extracts X X X X
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