TMI Blog2022 (12) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... unable to agree with the Adjudicating Authority that the Operational Creditors are to bear the cost of CIRP/Liquidation and hence, we set aside the impugned order to the extent para 9.IX as appearing supra and rest part of the impugned order we uphold. Let Liquidation be continued and let amount be realized during Liquidation and be distributed in accordance with section 53 of the Code. Appeal disposed off. - Company Appeal (AT) (Ins) No.876 of 2021 - - - Dated:- 1-12-2022 - [ Justice Rakesh Kumar ] Member ( Judicial ) And [ Dr. Ashok Kumar Mishra ] Member ( Technical ) For the Appellant : Mr. Jitender Chaudhary and Ms. Shilpa Chohan, Advocates For the Respondents : Mr. Gulshan Kumar Gutpa, Liquidator in-person for R-1. Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one Operational Creditor M/s. Elan Of the Corporate Debtor filed a petition under Section 9 of the Code for initiating CIRP alleging a default of Rs. 12,78,783/- (Rupees Twelve Lakh Seventy-eight Thousand Seven Hundred Eighty-three) and the same was admitted on 18.02.2020 by the Adjudicating Authority. Since IRP was not proposed by Operational Creditors, so the Adjudicating Authority appointed the IRP as par the prevalent system. 4. Public announcement was made on 05.03.2020 and five operational creditors filed their claims. Total claim was for Rs. 1,93,14,065/- and IRP accepted the claim of Rs. 1,22,07,343/-. The Operational Creditor on whose behest CIRP commenced didn t file their claim and on 09.03.2020 filed Form- RA for withdrawal o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into this problem. 9. The Ld. Counsel for the Respondent on enquiry was asked by the Bench why he went on continuing with the CIRP when the assets are very few and even CIRP costs cannot be recovered by selling all the assets of the CD whereas the IRP/RP claim is for Rs.18,59,183/-. There was no Financial Creditor in this case to be a part of CoC and only operational creditors who are members of the CoC. 10. The Liquidator in person submitted that he has not received any amount from Operational creditor or from the appellant and since the CoC has not voted for settlement so he has continued with CIRP and CoC members are duty bound to bear the CIRP expenses proportionately. 11. Mr. Harshit Goel Ld. Amicus Curiae submitted that the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceeds from the sale of the liquidation assets shall be distributed in the following order of priority and within such period and in such manner as may be specified, namely :- (a) the insolvency resolution process costs and the liquidation costs paid in full; (b) the following debts which shall rank equally between and among the following :- (i) workmen's dues for the period of twenty-four months preceding the liquidation commencement date; and (ii) debts owed to a secured creditor in the event such secured creditor has relinquished security in the manner set out in section 52; (c) wages and any unpaid dues owed to employees other than workmen for the period of twelve months preceding the liquidation commenceme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e debts in full; and (ii) the term workmen's dues shall have the same meaning as assigned to it in section 326 of the Companies Act, 2013. d. In view of aforesaid facts and circumstances, we are unable to agree with the Adjudicating Authority that the Operational Creditors are to bear the cost of CIRP/Liquidation and hence, we set aside the impugned order to the extent para 9.IX as appearing supra and rest part of the impugned order we uphold. Let Liquidation be continued and let amount be realized during Liquidation and be distributed in accordance with section 53 of the Code. We, accordingly, dispose of the appeal. No order as to costs. Interim order, if any, stands vacated. - - TaxTMI - TMITax - Insolvency & Bankr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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