AI Structured Summary
Not yet generated for this judgment
Judgment
26.05.2025: This appeal is directed against the order dated 20.10.2023 by which an application bearing IA No. 2321/MB/C-IV/2023 filed in CP (IB) 2207/MB/C-IV/2019 by the Interim Resolution Professional (IRP), invoking Rule 11 of NCLT Rules, 2016 for release of the professional fee and Corporate Insolvency Resolution Process (CIRP) expense to the tune of Rs. 93,78, 920/- and Legal Cost of Rs. 40, 000/- by the Respondents has been disposed of, restricting it to an amount of Rs. 20 lakhs plus GST plus expenses which has been ordered to be paid to the applicant.
One Satish Sadashiv Rane (FC) filed an application under Section 7 of the IBC, 2016 against the Shah Group Buliders Ltd. (SGBL) (CD) bearing CP (IB) No. 2207/ MB/C-IV/2019 before the National Company Law Tribunal, Mumbai Bench for the Resolution of their debt which was admitted on 08.07.2021 and the applicant/appellant namely, Sudha Pravin Navandar, was appointed as the IRP.
The order of admission was challenged before this court by way of CA (AT) (Ins) No. 558 of 2021 in which stay was granted on 06.08.2021 to the effect that the IRP shall not constitute the CoC.
During the pendency of the appeal, a settlement took place between the Suspended Director of the Corporate Debtor and the Financial Creditor on 20.09.2021. Pursuant to which the IRP filed FA on 23.09.2021.
The application filed under Section 12A was numbered as IA No. 2209 of 2021. It was allowed on 17.03.2023. As a result of which the CIRP proceedings initiated on 08.07.2021 came to an end.
Counsel for the appellant has alleged that it was provided in the agreement dated 20.09.2021 that the Corporate Debtor shall pay the fee and expenses incurred by the IRP.
Thereafter the appellant filed IA No. 1670/2022 for reimbursement of the fee and other CIRP cost in terms of the order passed on 17.03.2023. The said application was disposed of on 17.03.2023 in which it was held that the fee and the CIRP cost of the applicant/appellant shall be paid by the Corporate Debtor.
In the meantime, a handover of documents of Shah Group Builders Ltd. was entered into (agreement) as per which the appellant handed over the Corporate Debtor to the Promoters as a going concern. According to the appellant, it was decided therein as under:
“F. As per the order dated 17.03.2023, the CIRP Cost and IRP’s fee outstanding till 28-02-2023 of Rs. 90,90,626 is to be paid by the Corporate Debtor and the schedule of the same is confirmed by Directors of SGBL.
Further, as per para k “settlement and payment Modalities” of the Settlement agreement dated 20th September, 2021 it was agreed that cost and expenses shall be borne by the Corporate Debtor till disposal of 12A application.
Hence, in addition to aforementioned amount, proportionate fees of Rs. 2,91,194/- for the month of March till 17-03-2023 i.e. the date of pronouncement of order needs to be paid.
Summary of the payment to be made:
Particulars Amount in Rs. As per the approved detailed written submission attached herewith 90,90,626 Proportionate Fees for the Month of March i.e., till 17-03-2023 2,91,194 Total Fees and Expenses to be paid 93,81,820 (iii)The Directors of SGBL undertakes to pay CIRP Cost and IRP’s fee amounting to Rs. 93,81,820/- within 7 days from execution of this Agreement in accordance to said order”.
Since the amount due to the appellant was not paid, therefore, the appellant file IA No. 2321/MB/C-IV/2023, claiming the amount of Rs. 93,78, 920/- and Legal Cost of Rs. 40, 000/- from the Respondent. In this application the Tribunal passed an interim order on 10.08.2023 which read as under:
“1.Mr. Devarajan Raman, Ld. Counsel a/w Ms. Sudha N., IRP are present in IA- 2321/2023. Mr. Pulkit Sharma a/w Komal Patel i/b J Nishar & Co., Ld. Counsel for the Respondent present.
2.The Corporate Debtor is directed to pay the expenses, which pending to be reimbursed, and Rs. 20 lakhs plus GST thereon, as applicable, towards part of the professional fees within 15 days. The Applicant shall file necessary evidence(s) supporting her claim for verification of the Corporate Debtor, if not provided earlier.
3.List this matter for further consideration on 07.09.2023”.
According to the appellant, the interim order was passed for payment of Rs. 20 lakhs plus GST, part of the professional fee claimed by the appellant during the pendency of the main application. However, as per the appellant even this amount has not been paid so far.
The Ld. Tribunal, then passed the impugned order on 20.10.2023 and in the findings recorded it has been observed in paragraph 10 deeply.
“10.This bench notices that in view of the sequence of events no substantial professional work was done by the IRP after the date of settlement and the fee demanded by the IRP is neither fair and just nor reasonable”.
It is also observed that since Rs. 20 lakhs was ordered to be paid on 10.08.2023, therefore, the claim of the appellant is restricted to the amount of Rs. 20 lakhs only plus GST and expenses without giving any reason as to why the entire amount is not to be paid.
Counsel for the appellant has submitted that the impugned order is totally non-speaking and it violates the Principles of natural justice because in paragraph 10, the Tribunal has observed that it has noticed the sequence of events that no substantial professional work was done by the IRP after the date of settlement but those sequence of events are conspicuous by its absence in the impugned order.
We have specifically asked Counsel for the Respondent in this regard as to what are those sequence of events which are noticed by the Ld. Tribunal for the purpose of denying the amount paid by the appellant and restricted its claim to Rs. 20 lakhs which was ordered to be paid on 10.08.2023 to which he also feigned ignorance.
Thus, keeping in view the aforesaid facts and circumstances, we are satisfied that the impugned order is totally non-speaking which deciding the application of the appellant in which she has prayed for payment of the amount due to her on account of services rendered.
In such circumstances, it would be just and expedient that the impugned order be set aside and the matter is remanded back to the Ld. Tribunal with a direction to decide it again after giving reasons in the order as to why the appellant is not entitled to Rs. 93,78, 920/- as prayed for.
The appeal is thus allowed. Impugned order is set aside. Matter is remanded back to the Ld. Tribunal. The IA No. 2321/MB/C-IV/2023 which was disposed of by the impugned order is hereby restored.
The parties are directed to appear before the Tribunal on 16.06.2025.
Before parting with this order, we make it clear both the Tribunal as well as the Counsels appearing in this appeal that we have not made any observation on the merit of the case at all and have left everything to the Tribunal to decide. The IA’s if any pending are hereby closed.
Parties to bear their own cost.
The Tribunal is also requested to decide the application as early as possible preferably within the period of 2 months from the date of appearance of the parties.