Insolvency Proceedings Are Not Only For Fees Of Resolution Professional: NCLAT
National Company Law Appellate Tribunal (NCLAT) principal bench comprising of Justice Ashok Bhushan and Ms Shresha Merla in the case of Deepankar Sharma versus Pradeep Cycle Industries held that the Insolvency Proceedings are not proceedings only for fees of the Interim Resolution Professional (IRP). This order arises out of an appeal filed by the erstwhile IRP of Arpan International...
National Company Law Appellate Tribunal (NCLAT) principal bench comprising of Justice Ashok Bhushan and Ms Shresha Merla in the case of Deepankar Sharma versus Pradeep Cycle Industries held that the Insolvency Proceedings are not proceedings only for fees of the Interim Resolution Professional (IRP).
This order arises out of an appeal filed by the erstwhile IRP of Arpan International Pvt. Ltd. against the order dated 16.03.2022 of NCLT wherein NCLT has decided that the IRP is entitled to the fees of 1,75,000/- instead of INR 3,75,000/-
Brief Facts
Corporate Insolvency Resolution Process (CIRP) of Arpan International Pvt. Ltd. was initiated by National Company Law Tribunal (NCLT) on 22.12.2021 however the Operational Creditor and Corporate Debtor entered into settlement and an application for withdrawal of petition was filed on 03.01.2022. NCLT issued notice to the IRP for the purpose of deciding his fees and after hearing the IRP, directed the applicant to pay an amount of to the IRP.
Contentions Of IRP
It was contended on behalf of the IRP that the fees decided by the NCLT does not commensurate the work done by the IRP and therefore, an amount of INR 3.75 lakhs is to be paid to the IRP.
Decision/Analysis Of NCLAT
NCLAT held that the IRP virtually effectively worked for only 14 days and in such scenario, the fees decided by NCLT doesn't warrant any interference.
NCLAT further observed that the IRP only filed the present appeal only for raising the issues of fees whereas he only worked for 14 days and the cost directed by NCLT is quite reasonable and appropriate.
"…We are of the view that the Insolvency Proceedings are not the proceedings for only fee of the IRP and RP payment of fee and cost are only consequential to the main proceeding."
Accordingly, NCLAT dismissed the appeal by observing that the IRP has rushed to the appellate without any valid grievance.
Case Title: Deepankar Sharma versus Pradeep Cycle Industries
Counsel for Appellant: Adv. Yash Gupta