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2021 (3) TMI 454 - INSOLVENCY AND BANKRUPTCY BOARD OF INDIABills for fee of Interim Resolution Professional - typographical error in the invoice - violation of section 208(2)(a), (b) and (e) of the Code, regulation 33(3) of CIRP Regulations, 2016, regulation 7(2)(h) of the IP Regulations, read with clauses 25, 25A, 26 and 27 of the Code of Conduct under the First Schedule of the IP Regulations, Circular No. IP/004/2018 dated 16th January, 2018 and Circular No. IBBI/IP/013/2018 dated 12th June, 2018 - HELD THAT:- DC finds from the material available on record that the bills raised by Ms. Jain dated 4-4-2019, 15-4-2019, 26-4-2019 and 29-7-2019 were addressed to the CD. Ms. Jain has submitted that the IRP appointment was not proposed by the operational creditor, FLSmidth Private Limited instead, it was the AA that appointed Ms. Jain as IRP. On perusal of the Order dated 27-3-2019 of the AA it is observed that the Applicant, FLSmidth Private Limited had not suggested any name for IRP and the AA directly appointed Ms. Jain as IRP, with the further direction to Applicant to pay sum of ₹ 50,000/- to IRP as advance fees - DC finds that there does not appear to be any contravention by Ms. Jain as the applicant refused to bear the cost and the CoC had ratified the fees of IRP and informed her to issue the bills in the name of the CD. Cost Disclosure by IRP - HELD THAT:- As valuers appointment was also the part of CIRP cost, it was expected from RP and CoC to communicate and the CoC vide e-mail dated 12-7-2019 had requested IRP to wait till such approval from CoC. Therefore, Ms. Jain filed the cost disclosure on 30-10-2019 with IPA on the information available, assuming that any subsequent revision will be dealt with later on. The submission of the IRP is found to be satisfactory and no contravention could be made out. Appointment of valuers by Resolutional Professional (RP) who are not Registered Valuers (RV) - violation of Section 208(2)(a) and (e) of the Code, regulation 27 of CIRP Regulations 2016 and Regulation 7(2)(a), (h) and (i) of the IP Regulations, read with clause(s) 10 and 14 of the Code of Conduct as given in the First Schedule of the IP Regulations and Circular No. IBBI/RV/019/2018 dated 17th October, 2018 - HELD THAT:- From a bare perusal of the provisions of the regulations and circular made thereunder, it is clear that it is the duty of the IRP to appoint registered valuers within 7 days of his appointment, but not later than 47th day from the insolvency commencement date to determine the fair value and liquidation value of the CD. The IBBI further clarified in explicit terms through the aforesaid circular that no IP shall appoint a person other than a registered valuer to conduct any valuation under the Code or any of the regulations made thereunder. In the present case, DC notes that Ms. Jain had appointed LSI Engineering & Consultants Ltd. and AAA Valuation Professionals LLP on 12th July 2019, who were not registered with the IBBI. However, Ms. Jain contended that there is no contravention as the valuer appointment letters that she had sent were subsequently cancelled by CoC later on and the RP has presently appointed a different set of valuer. The date when the valuers were appointed she was no longer part of CIRP - the DC notes that the Ms. Jain had appointed LSI Engineering & Consultants Ltd and AAA Valuation Professionals LLP in contravention of the regulation and circular. However, the appointment of valuer was later cancelled by CoC and registered valuers were appointed by the RP, Mr. Abhilash Lal as per the regulations. Hence, DC is of the view that lenient view may be taken. Relationship Disclosure by IRP - HELD THAT:- Ms. Jain, the DC is of the opinion that IRP can take assistance from the back office support in managing the day to day operation of CD and no specific disclosure is required for the same. However, if the fees of the support staff are paid from CIRP Cost on ratification of the CoC the same has to be duly disclosed but in the present instance the personnel were employed directly by IRP and their fees were not charged from CIRP cost. Hence, there is no requirement of informing the CoC of the relationship as related party of the support staff. Thus, there is no contravention in this regard. Public Announcement by IRP - HELD THAT:- The public announcement is made by the IRP immediately after the appointment, to inform the public that a CD is undergoing CIRP. It is the vital first step after initiation of CIRP as it provides an opportunity to the creditors submit their claims of liability against the CD which are to be considered while resolving insolvency - the public announcement was made within stipulated time and five claims were also received subsequently and mere rearrangement of link on the website does not amount to delay in publishing. Thus, the DC is of the view there is no contravention with regard to publication of public announcement. SCN disposed off.
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