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2022 (9) TMI 277 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHIDuties and functions carried out by IRP. - Disallowing certain CIRP expenses claimed by the Appellant/IRP - the IRP himself filed the CIRP withdrawal application just within 12 days after commencement of the CIRP - whether it was justified on the part of the IRP to still continue with the CIRP proceedings - disallowing certain CIRP expenses claimed by the Appellant/IRP by treating them as “non-essential”? - whether the remarks disapproving the conduct of the IRP in the present matter by the Adjudicating Authority stands to reason? - HELD THAT:- It is an undisputed fact that the Operational Creditor having entered into a settlement with the Corporate Debtor, he had informed the IRP on 12.10.2021 in the prescribed format, seeking withdrawal of CIRP. Within six days, on 18.10.2021, the IRP had also filed the CIRP withdrawal application before the Adjudicating Authority. The Corporate Debtor also had taken steps on his part before the Adjudicating Authority on 17.10.2021 for stay on the CIRP and also filed an application on 22.10.2021 for withdrawal of the CIRP. It is therefore amply clear that all the important stakeholders in the process were in unison in seeking closure of CIRP and awaiting final directions of the Adjudicating Authority. The Adjudicating Authority after categorizing the costs as essential and non-essential have allowed the CIRP costs to the extent of Rs. 8,36,001/- to be reimbursed by the Corporate Debtor. The Adjudicating Authority has also allowed certain amount as the expenses of the IRP and for payment towards his fees - since the Section 12A application was filed by the IRP before the Adjudicating Authority well before the constitution of CoC, the IRP’s continuance with the CIRP process without making adequate efforts to seek pointed clarification from the Adjudicating Authority on whether to proceed with the CIRP or not, does not reflect well on his conduct. IRP cannot afford to be unmindful of the fact that he is the driving force and the nerve-center in the resolution process and is expected to assist in the CIRP process in a fair and objective manner in the best interest of all stakeholders. In the IBC framework, the IRP is the fulcrum of the CIRP process and is obligated to act as the bridge between the Adjudicating Authority, the CoC and other stakeholders including the Corporate Debtor. As an officer of the court vested with administrative powers, the IRP as the facilitator of the resolution process needs to conduct the process with fairness, diligence, forthrightness and highest sense of responsibility. This aspect squarely finds place in Section 208(2)(a) of the IBC which subjects the insolvency professionals to abide by a code of conduct which, inter-alia, obligates the IRP to take reasonable care and diligence while performing his duties. It is clear that what is reasonable, is not amenable to precise definition and therefore is context specific. Given that CIRP withdrawal application before the Adjudicating Authority was a known factor, it would only have been fair on the part of the IRP, if instead of pressing the accelerator on the CIRP process, he had pursued in serious earnest with the Adjudicating Authority for its clear directions and guidance on proceeding with the CIRP - the IRP seems to have taken advantage of the fluid situation and unnecessarily added to the costs by carrying out activities which could have otherwise been put on hold and find the conduct of the IRP deprecatory. There are no substance in the submission raised by the Learned Counsel for the Appellant to warrant any interference in the impugned order. The impugned order passed by the Adjudicating Authority, not suffering from any infirmities, is hereby affirmed - appeal dismissed.
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