2023 (3) TMI 590 - AT - Insolvency and Bankruptcy

Seeking direction to Resolution Professional to change the status of the Applicants from Collateral to Allottees and consider them as Financial Creditors (Real Estate Investors i.e. Allottee) u/s 5(8)(f) of the Code - rights of the applicants as per the provisions of the I B Code 2016 - direction to Resolution Professional to provide Proper signed Valuation Reports of both the valuers - direction to Resolution Professional to provide the Inventory details of CD as on ICD - Avoidance Applications filed u/s 25(2)(i) r/w Rule 35A of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations 2016. HELD THAT - It is well settled that Resolution Professional has no adjudicatory power and its jurisdiction is only administrative to collate and verify the claims as per the CIRP Regulation 2016. When the application was filed before the Adjudicating Authority inviting a decision on the status of the applicant Adjudicating Authority ought to have decided the application on merit instead of asking the appellant to file the documents before the Resolution Professional and directing the Resolution Professional to pass the reasoned decision. The decision was required to be taken by Adjudicating Authority itself. The impugned order passed by Adjudicating Authority cannot be sustained and is hereby set aside - Appeal disposed off.

Summary

Issues Involved:
1. Disposal of application by Adjudicating Authority without deciding on merits.
2. Role and jurisdiction of Resolution Professional in deciding claims.
3. Pending approval of resolution plan before Adjudicating Authority.

Summary:

Issue 1:
The appeal was filed against an order passed by the Adjudicating Authority directing the Appellant to submit documents before the Resolution Professional regarding the status of allottees. The Appellant's claims were initially verified as allottees but later changed to collateral, prompting the filing of the appeal with specific prayers related to their status and rights under the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority, in its order, allowed the Appellant to challenge the Resolution Professional's decision after providing an opportunity to be heard.

Issue 2:
The Appellant argued that the Adjudicating Authority should have decided the application on its merits instead of directing them to approach the Resolution Professional, emphasizing that the Resolution Professional lacks adjudicatory jurisdiction. The Tribunal agreed, stating that the Resolution Professional's role is administrative in nature to verify claims as per the CIRP Regulations, 2016. The Tribunal set aside the Adjudicating Authority's order and revived the application to be heard and decided on its merits by the Adjudicating Authority.

Issue 3:
The Appellant also mentioned that the approval of the resolution plan is pending before the Adjudicating Authority, urging that the pending applications should be decided before the resolution plan approval. The Tribunal disposed of the appeal accordingly, emphasizing the need for the Adjudicating Authority to address the pending applications before finalizing the resolution plan approval.