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TMI Blog2021 (10) TMI 594X X X X Extracts X X X X X X X X Extracts X X X X ..... e National company Law Appellate Tribunal (NCLAT), and Vide judgment dated 14.08.2020, the Hon'ble NCLAT allowed the said appeal and directed as under: "26. The Adjudicating Authority will fix the fee of 'Interim Resolution Professional' for the period he has functioned." * That the details of professional fees and expenses incurred by the IRP from March, 2020 to August, 2020 have been placed. 3. The Respondent has filed its reply and written arguments raising objections against the prayer of applicant, stating that: * Hon'ble NCLAT in its order dated 14.08.2020, has nowhere mentioned that the payment of the said fee will be made by the corporate debtor. * Further, it is stated that in terms of Regulation 33(3) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations), the applicant is to bear expenses incurred by the IRP, which shall then be reimbursed by the CoC. Since in the present matter, CoC was not constituted and Hon'ble NCLAT has noted in its order that the initiation of CIRP was suffered from grave legal infirmity, hence the Respondent No. 1 should not be burdened with extra expenses such as fee of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... * The (IBBI) committee found that the fees of Rs. 17,70,000/- as claimed by applicant is unreasonable. The committee considered that for the activities performed by applicant on a limited scale, a total fee of Rs. 2,00,000/- (calculated at Rs. 40,000/- per month) may be considered as reasonable. * The committee observed that the applicant has * made two announcements. First public announcement was made in March, 2020 at cost of Rs. 47,074/-, which covered 5 cities and 10 editions and the second was made in in April 2020 (at the cost of Rs. 48,646/-) covering 1 city and 2 editions. The committee did not find the cost incurred towards second public announcement as acceptable as the same was not necessary, given that the first public announcement was already made. * It is stated that the applicant appointed Pankaj Agarwal & Associates, Advocates and Solicitors for the purpose of claims' verification on 16.05.2020 and a bill No. APIL/NCLT-CD-2/07/2020-21 for an amount of Rs. 1,75,000/- was raised to the applicant towards the said claim verification. It is observed by the committee that since the claim verification is the duty of IRP under the Code, it cannot be outsourced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Debtor, all kind of creditors had filed their claims. Several Creditors such as Banks and Financial Institutions, Debenture Holders, Decree-Holders, were not exclusive to any particular project and as a result, all of them filed their claims. Being the IRP, it was the Applicant's duty to collect and verify the every claim received by him. That the Committee has failed to consider the fact that the appointment of Mr. Pankaj Agarwal, Advocate, was made to obtain legal advice in verification of the Claims filed by Banks, which require legal assistance. Such appointment was required to discharge the responsibility cast upon the IRP. * The committee has erroneously recorded that the second public announcement was not necessary, given that the first public announcement was already made. It is stated that the first Public Announcement was made in Form A on 18.03.2020 after the commencement of CIRP. Thereafter, in the Appeal filed by the Management of the Corporate Debtor, the Hon'ble NCLAT, vide order dated 20.03.2020, directed to limit the CIRP to 2 RERA registered projects. The said projects are situated in Lucknow, Uttar Pradesh, hence, in order to comply with the directions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted the report and the operative portion of the report has already been referred to Supra, therefore, it is needless to repeat the same. 12. Now in the light of submissions, we consider the prayer of the applicant. It is an admitted fact that the CIRP initiated against the respondent is set aside by the Hon'ble NCLAT in Company Appeal 80 (Insolvency No. 452/2020) and while disposing of the appeal the Hon'ble NCLAT in para 26 of the Judgment observed that "the Adjudicating Authority will fix the fee of IRP for the period he has functioned" and in pursuance of that direction, the present application is filed. 13. In terms of the Regulation 33 of the IBBI (Insolvency Resolution Process for Corporate Person) Regulation 2016, cost of the Interim Resolution Professional shall be fixed by- "Regulation 33 - Costs of the interim resolution professional. (1) The applicant shall fix the expenses to be incurred on or by the interim resolution professional. (2) The Adjudicating Authority shall fix expenses where the applicant has not fixed expenses under sub-regulation (1). (3) The applicant shall bear the expenses which shall be reimbursed by the committee to the extent it r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ored while arriving at the fee payable to IRP. * It is submitted that the committee opined that Rs. 42,750/- claimed by applicant towards other expenses can be considered as acceptable. * In respect of cost of legal retainership, it is submitted that the applicant appointed Shohit Chaudhry & Associates, Advocates, as legal counsel for the given purpose on 15.05.2020 the appointment was confirmed on 26.05.2020. The appointment was made after two months gap from CIRP Commencement date. It is submitted that Bill of Rs. 6,00,000/- raised by advocates is not acceptable and fee of Rs. 3,00,000/- may be considered as acceptable keeping in view that the work performed by the advocate was limited for the period of two months only". 16. On the basis of this report, we notice that the IBBI has fixed the total fee of IRP of Rs. 2,00,000/-, @ 40,000/- per month and also allowed the legal retainership fee of Rs. 3,00,000/-. 17. We further notice that towards other expenses, the IBBI has recommended to accept a cost of Rs. 47074/- towards the first public announcement only but reject the cost of Rs. 48646/- towards the second public announcement. And for other expenses, the IBBI has recomme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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