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TMI Blog2022 (11) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... D VERSUS SATISH KUMAR GUPTA ORS. [ 2018 (10) TMI 312 - SUPREME COURT ] - the Hon ble Supreme Court in the above judgment while discussing the policy decision observed that policy decision would be that decision that would be beyond running day-to-day decisions, i.e., long term decisions. From the clauses of the MoU as noted above, it is clear that decision pertaining to pricing has to be taken with the mutual consent. Thus, there is sufficient control of the Appellant as envisaged in provisions of law. The Appellant being Joint Venture Company of the Corporate Debtor was clearly related party and no error has been committed by IRP in declaring the Appellant as related party . The present is a case, which cannot be said to be a case where IRP has suo-moto changed its decision. The IRP has corrected its earlier decision of admitting the claim of Financial Creditor by changing the category of Appellant as related Financial Creditor. What was held by this Tribunal was that RP cannot change the status of existing creditor on his own. The RP has to maintain an updated list of claims and is entitled to correct the errors, if any, in accepting or rejecting the claim. Further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellant holding the Appellant as a related party to the Corporate Debtor on the basis of objection raised by Punjab National Bank in the CoC meeting. (vii) The Resolution Plan was approved by the CoC on 04.05.2022. On 06.05.2022, an IA was filed by the Appellant being IA No.2325 of 2022 seeking a direction to include the Appellant as CoC Member. (viii) Both IAs came for consideration before the Adjudicating Authority, who by the impugned order rejected the IA filed by the Appellant and affirmed the communication of the IRP that the Appellant is a related party of the Corporate Debtor. (ix) Aggrieved by the order of the Adjudicating Authority dated 24.08.2022, this Appeal has been filed. 3. We have heard Shri Abhishek Anand, learned Counsel appearing for the Appellant and Shri Saurav Kalia, learned Counsel for the Respondent. 4. The learned Counsel for the Appellant submits that Appellant has no control over the Corporate Debtor nor any representation on the Board of Directors. The Appellant is also not a shareholder or Director of the Corporate Debtor. It is submitted that the Appellant is not covered by the definition of related party within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company. 9. Section 2, sub-section (6) specifically notices the Joint Venture Company, when it uses expression includes a joint venture company . 10. Memorandum of Understanding, which is admittedly executed between the parties on 26.11.2012, i.e., between the Appellant and the Corporate Debtor. The MoU provides AND WHEREAS the Second Party has offered to participate in development of the said project by way of bringing in funds into the said project . Under the MoU, the Second Party is Appellant before us. Paragraphs 5, 6, 7 and 8, which are relevant in the present case are as follows: 5. The entire project admeasuring 6.45 Acres approximate i.e. the Annexure A and Annexure B lands will be developed by the First Party at its own cost and expenses and will also be marketed by the First Party in its own name and under its own brand. The Selling Price of the units of the said project shall be decided with the mutual consent of the parties. The First Party shall complete the development of the said project within a period of 36 months from the date of receipt of all permissions and approvals. 6. The gross revenue of the entire project admeasuring 6.45 Acres app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns, they could be said to be in control . A management decision is a decision to be taken as to how the corporate body is to be run in its day-to-day affairs. A policy decision would be a decision that would be beyond running day-to-day affairs i.e. long-term decisions. So long as management or policy decisions can be, or are in fact, taken by virtue of shareholding, management rights, shareholders agreements, voting agreements or otherwise, control can be said to exist. 13. The Hon ble Supreme Court in the above judgment while discussing the policy decision observed that policy decision would be that decision that would be beyond running day-to-day decisions, i.e., long term decisions. From the clauses of the MoU as noted above, it is clear that decision pertaining to pricing has to be taken with the mutual consent. Thus, there is sufficient control of the Appellant as envisaged in provisions of law. The Appellant being Joint Venture Company of the Corporate Debtor was clearly related party and no error has been committed by IRP in declaring the Appellant as related party . 14. The learned Counsel for the Appellant submitted that IRP has no power to review its decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating Authority. The aggrieved person can challenge either constitution of Committee of Creditors or for any grievance against rejection, incorrect acceptance or categorisation of creditors before the Adjudicating Authority. But the Resolution Professional cannot arbitrarily on its own overturn earlier decision, to change the status of a creditor from Financial Creditor to Operational Creditor. 27. Under the duties of RP to maintain an updated list of Claim, he cannot change the status of an existing creditor on his own. But to maintain an updated list of claims the IRP/RP is authorised to add to existing claims or admit or reject further claims received collating them and thus update the list of creditors accordingly. 38. It is also necessary to mention that core duty of IRP is to receive, collate and verify claims which cannot be further delegated to Committee of Creditors , who in turn cannot be allowed to do the same in purported exercise of Commercial Wisdom. 17. The above judgment has no application in the present case. What was held by this Tribunal was that RP cannot change the status of existing creditor on his own. The RP has to maintain an updated list ..... X X X X Extracts X X X X X X X X Extracts X X X X
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