Case Note & Summary
The appeal was filed by Amit Chandrashekhar Poddar, the Resolution Professional of Khadkeshwar Hatcheries Limited, against an order from the NCLT, Mumbai Bench, which contained adverse remarks regarding his conduct. The NCLT had noted that the Earnest Money Deposit (EMD) of Rs. 10 Lakhs was not encashed in a timely manner, leading to concerns about the Resolution Professional's actions. The appellant argued that the delay was due to the Director of the PRA/SRA being out of the country and that the failure to deposit the Demand Draft was an inadvertent mistake. The Tribunal reviewed the circumstances surrounding the delay, including the approval of the resolution plan by the Committee of Creditors (CoC) and concluded that the lapse was minor and did not affect the CIRP process. The Tribunal ultimately set aside the adverse remarks made by the NCLT, stating that they were unwarranted and should not have been reported to the IBBI, as they did not constitute a material irregularity. The appeal was disposed of without costs.
Headnote
A) Corporate Law - Resolution Professional Conduct - Adverse Remarks - Insolvency and Bankruptcy Code, 2016, Section Not Mentioned - The Tribunal found the lapse of the Resolution Professional in not encashing the Demand Draft for EMD to be inadvertent and not material enough to vitiate the Corporate Insolvency Resolution Process (CIRP). The Tribunal set aside the adverse remarks made by the Adjudicating Authority, emphasizing that the lapse did not delay the CIRP process and should not have been reported to the IBBI (Paras 10-12).
Issue of Consideration
Whether the adverse remarks made by the Adjudicating Authority against the Resolution Professional were justified and warranted reporting to the IBBI.
Final Decision
The Tribunal set aside the adverse remarks recorded against the Appellant/Resolution Professional in Para No. 15 of the impugned order, stating that the lapse was minor and inadvertent, and did not warrant reporting to the IBBI. The appeal was disposed of in the terms mentioned in the judgment without costs.
Law Points
- Corporate Insolvency Resolution Process
- Resolution Professional conduct
- Adjudicating Authority observations
- IBBI reporting
- inadvertent lapses
