9911796707
TMI Blog2023 (8) TMI 662X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to the IRP. The reasons ascribed by the Adjudicating Authority are cogent and weighty because in the absence of the requisite documents/details/records, it could not have been expected for such an exercise to have been undertaken in the right earnest - the exclusion of these expenses by the Adjudicating Authority was done after due and proper application of mind which was only fair and reasonable. The applicability of the judgment of this Tribunal in MADHUSUDAN SHARMA VERSUS J.D. ANEJA EDIBLES PVT. LTD. [ 2019 (8) TMI 1871 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] has to be tested against the facts of the present case. That the withdrawal and stay application were heard several times is an admitted fact. However, there is nothing on record in the interim orders to show that the Appellant had been successful in demonstrating before the court the conundrum confronting him in the conduct of CIRP. The Appellant has taken the pretext that the Adjudicating Authority had made an oral observation during the hearings that it would not pass any interim order on the stay as may be seen at page 5 of Appeal Paper Book - the Madhusudan decision cannot come to aid of the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Adjudicating Authority, inter-alia, seeking approval of CIRP withdrawal application filed under Section 12-A of the IBC; discharge from duties as IRP and for payment of actual expenses incurred by him as IRP. The Adjudicating Authority vide impugned order dated 30.05.2022 while allowing the withdrawal application, discharged the IRP from his duties after modifying the reimbursement of expenses claimed by the IRP besides making certain remarks deprecating the conduct of IRP. The IRP, who in the meantime was confirmed as Resolution Professional, challenged the above impugned order before this Tribunal in Company Appeal (AT) (Ins.) No.896 of 2022. In exercise of its appellate jurisdiction this Tribunal, on 05.09.2022, dismissed the appeal and affirmed the impugned order. Aggrieved by the decision of this Tribunal, the present Appellant filed a Civil Appeal before the Hon ble Supreme Court, which Appeal got dismissed on 13.12.2022. However, liberty was granted by the Hon ble Supreme Court to the present Appellant to file an application before the NCLAT in reference to the facts which have been noticed in Paragraphs 14 and 15 of the order impugned dated 30th May, 2022. 3. The fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 Applications filed, expense incurred. Ratified with 88.96% voting share in the 6th CoC meeting held on 28.03.2022 7. PVRN Company (CA) Transaction Auditor on CIRP 106200 Exercise completed. Fees ratified by CoC with 100% voting share in 2nd CoC. 8. Hyoka Valuers Pvt. Ltd. Registered Valuers (P M, L B) 75000 Valuation exercise for L B assets completed and report handed over to the RP. P M work pending as directors not cooperating. CoC has ratified the fees with 100% share in the 2nd CoC. 9. R.K. Arora Registered Valuer (L B) 34000 Valuation exercise of L B assets completed and report submitted to the Resolution Professional . CoC has ratified fees with 100% voting share in 2nd CoC. 10. Prateek Mittal Registered Valuer (SFA) 29500 Valuation exercise is pending as directors not handing over record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noticed that the Directors have not handed over the records and assets to the IRP subsequent to their settlement with the Operational Creditor. This Bench, therefore, proceeds to categorize the activities for which expenses have been claimed as mentioned in Para 14 into two different categories; essential and non-essential. We are of the view that activities mentioned in Sr. No.1 to 7 of the above-mentioned table in Para 124, consisting of expenses on account of e-voting agency, security services, publishing house, payments to advocates and transaction auditor as essential and allow the expenses incurred on those activities. The expenses relating to the valuation are disallowed because the Directors have admittedly not handed over the records and assets. Similarly, the payment to advocate for a PUFE transaction for application under preparation is disallowed because, in the absence of records, it is difficult to justify any payment for the preparation of such an application. While, we allow the expense of the IRP amounting to Rs.1,48,237/-, the payment towards his fees is restricted to Rs.2 Lakhs as we strongly disapprove his conduct in not pursuing the present application filed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of completed items where fees/expenses had become payable rather than perfunctorily send the list of expenses by including items which had not been initiated or lying incomplete. It also remains unexplained as to why the IRP was in such a tearing hurry to get the fees ratified in the CoC meetings. This tendency on the part of the IRP to include such uninitiated and incomplete works in the items of expenses which were not on the anvil makes us believe that there was an underlying intent to inflate the volume of expenses. Needless to add, the IRP is an officer of the Court and is expected to safeguard and ensure the prospects of revival of a dying Corporate Debtor and not overburden it by charging arbitrary and exorbitant fees and expenses. 8. While examining the factors behind disallowing of non-essential expenses by the Adjudicating Authority, we find that the reasons assigned by the Adjudicating Authority has been the absence of records and the non-handing over of the assets by the suspended management to the IRP. The reasons ascribed by the Adjudicating Authority are cogent and weighty because in the absence of the requisite documents/details/records, it could not have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the present case. That the withdrawal and stay application were heard several times is an admitted fact. However, there is nothing on record in the interim orders to show that the Appellant had been successful in demonstrating before the court the conundrum confronting him in the conduct of CIRP. The Appellant has taken the pretext that the Adjudicating Authority had made an oral observation during the hearings that it would not pass any interim order on the stay as may be seen at page 5 of Appeal Paper Book. In the first place, the Appellant having adverted to an oral observation made by the Court, the authenticity of which is not verifiable as it is not substantiated by the records, we are thus not impressed by this defence. For the sake of argument, even if we accept this contention, it is nevertheless an admission of failure on the part of the Resolution Professional. Had the Appellant persuasively pressed the matter before the Adjudicating Authority rather than merely registering his presence, the Appellant would have been able to engage the attention of the Adjudicating Authority to the special circumstances warranting an expeditious decision on the withdrawal and stay appl ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
