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2019 (6) TMI 167 - AT - Insolvency and BankruptcyWhether in a ‘Corporate Insolvency Resolution Process’ triggered u/ss 7 or 9 or 10 of the ‘I&B Code’, the Adjudicating Authority has power to convert the ‘Corporate Insolvency Resolution Process’ as a ‘Fast Track Corporate Insolvency Resolution Process’ u/s 55 of the ‘I&B Code’? - HELD THAT:- In the present case, the application was not filed under Section 55 but u/s 9 of the ‘I&B Code’. In terms of Section 12 ‘Corporate Insolvency Resolution Process’ was required to be completed within 180 days from the date of admission. Sub-section (3) of Section 12 empowers the Adjudicating Authority to extend the period beyond 180 days but it cannot exceed 90 days - the Adjudicating Authority has no jurisdiction to proceed with the ‘Corporate Insolvency Resolution Process’ beyond the period of 270 days having not empowered under the provisions of the ‘I&B Code’. Sub-section (2) of Section 55 of the ‘I&B Code’ stipulates that an application for ‘Fast Track Corporate Insolvency Resolution Process’ can be made against (i) the ‘Corporate Debtor’ whose assets and income is below a level, as may be notified by the Central Government or (ii) the ‘Corporate Debtor’ with such class of creditors or (iii) such other category of corporate persons as may be notified by the Central Government - the ‘Fast Track Corporate Insolvency Resolution Process’ is different from ‘Corporate Insolvency Resolution Process’ against such ‘Corporate Debtor(s)’ as may be notified by the Central Government in terms of clauses (a), (b) & (c) of sub-section (2) of Section 55. The Adjudicating Authority exceeded its jurisdiction by extending the period of 90 days after completion of 270 days of the ‘Corporate Insolvency Resolution Process’ wrongly exercising its power under sub-section (2) of Section 55 which is not applicable - answered in negative. Whether ‘Committee of Creditors’ had jurisdiction to replace the ‘Resolution Professional’ after completion of 270 days? - HELD THAT:- After completion of 270 days, the ‘Committee of Creditors’ ceased to exist and thereby they have no jurisdiction to replace a ‘Resolution Professional’ u/s 22 of the ‘I&B Code’. Even if the decision to replace the ‘Resolution Professional’ is taken prior to 270 days, in absence of any order passed by the Adjudicating Authority, such decision cannot be entertained on completion of 270 days. However, the ground taken by the ‘Committee of Creditors’ can be looked into by the Adjudicating Authority to decide whether the same ‘Resolution Professional’ should be allowed to continue as ‘liquidator’ of the ‘Corporate Debtor’ - answered in negative. Whether Adjudicating Authority is empowered to decide the resolution cost, including the resolution fee payable to the ‘Resolution Professional’? - HELD THAT:- In case ‘Corporate Insolvency Resolution Process’ fails and order of liquidation is passed u/s 33 in such case, the ‘Resolution Professional’ can be removed if it is found that he has violated Section 30(2) or otherwise he is to be allowed to function as ‘liquidator’ - In the present case, as no order has been passed under Section 31, nor any order has been passed by the Adjudicating Authority u/s 33, we hold that the Adjudicating Authority had no jurisdiction to decide the resolution cost including the fee of the ‘Resolution Professional’. The impugned order dated 25th July, 2018 is set aside - The Adjudicating Authority is directed to pass order u/s 31 but if no ‘Resolution Plan’ has been approved, the Adjudicating Authority will pass order u/s 33 of the ‘I&B Code’, more than 270 days having expired - Appeal allowed.
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