Mr. Gajesh Labhchand Jain vs Committee Of Creditors Of E&G Global Estates Private Limited

Per: Suchitra Kanuparthi, Member (Judicial)

The Applicant Resolution Professional has filed an application bearing I.A. 1201 of 2020 in C.P. 2995 of 2019 on 12.08.2020 under Section 60(5) of Insolvency and Bankruptcy Code, 2016 (hereinafter referred as "The Code") read with Regulations 6(3), 31(c), 31(d), 33(3) and 34 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 seeking the order of direction to COC members to contribute their share towards CIRP cost.

The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor by an Order dated 24.06.2020, on a Section 7 Petition filed by the Financial Creditor (SIDBI), wherein Mr. Gajesh Labchand Jain was appointed as Interim Resolution Professional (IRP).

Subsequently the Applicant submits that a public announcement was made by the Applicant on 26.06.2020 seeking claims from all the creditors by 08.07.2020. The Applicant has identified financial creditors being Home Buyers. The Applicant had nominated three Authorised Representatives for class of financial creditors and Form AB were obtained from the nominated Authorised Representatives in terms of the provisions of Section 21 of the Code read with Regulation 4A of the IBBI (CIRP) Regulations, 2016.

Subsequently, votes of class of financial creditors were collated and Mr. Jitender Kothari bearing registration number IBBI/IPA-001/IP-P00540/2017-18/10965, with the highest number of votes of the financial creditor, was selected as the Authorised Representative for the “Home Buyers” of the Corporate Debtor. This Bench has already confirmed appointment of Mr. Jitender Kothari as the “Authorised Representative” vide its Order dated 18.08.2020 in IA 1079 of 2020 in C.P. No. 2995 of 2019.

It is then submitted by the Applicant that as on the date of hearing of this Application, the Applicant/ Interim Resolution Professional has been confirmed to act as a Resolution Professional in the matter. The Applicant submits that expenses have been incurred during the ongoing Corporate Insolvency and Resolution Process which forms part of the Insolvency Resolution Process Costs (hereinafter referred as “IRPC”) in terms of Section 5(13) of the Code read with Regulation 31 and 34 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which remain unpaid by the CoC while there are insufficient funds in the account of the Corporate Debtor.

The Applicant submits that the CoC comprises of SIDBI with 21% voting share and the class of creditors being home buyers with 79% voting share. While some of the Insolvency Resolution Process Costs (IRPC) incurred so far have been ratified in the first CoC meeting held on 24.07.2020 and some costs are ratified during the 2^nd CoC meeting held on 01.09.2020, but the financial creditors since the initiation of CIRP have infused funds so as to pay such costs and there are no funds in the Corporate Debtor Company.

The Applicant also submits that he has incurred costs right from the date of initiation of CIRP, the details of the said costs are summarised below. It is submitted that the second CoC meeting was held on 01.09.2020 which was after the filing of the present Application and hence, the updated cost scheduled with details of ratification as per the table below was produced before this Bench:

The table above demonstrates the date on which the quantum of payment was ratified by the COC in their meetings held. An amount of Rs20,32,520/(Twenty Lakhs, Thirty Two thousand, five hundred and twenty rupees only) towards the CIRP cost which was already ratified by the COC may be paid immediately forthwith by the COC. It is further directed that the COC members may contribute to the CIRP costs as per the CIRP regulations.

In the light of above observation, it is ordered as follows: