2017 (9) TMI 1616 - Tri - Insolvency and Bankruptcy

Transfer of Petition to Tribunal under Insolvency Code: Interim Resolution Professional's Key Responsibilities and Reporting Duties

The petition was transferred from the High Court to the Tribunal under the Insolvency and Bankruptcy Code, 2016. An Interim Resolution Professional was ... Formal orders of appointment of Interim Resolution Professional and further directions - Held that:- Appoint Mr. Harish Taneja, Registration No.IBBI/IPA-002/IPN00088/ 2017-18/10229, resident of 236-L, Model Town, Sonipat-131001, email: [email protected]; Mobile No.9811565629 as Interim Resolution Professional; The term of appointment of Mr. Harish Taneja shall be for a period of 30 days from the date of his appointment as Interim Resolution Professional or as may be determined by the committee of creditors whichever is earlier; In terms of Section 17 of ‘the Code’, from the date of this appointment, the powers of the Board of Directors shall stand suspended and the management of the affairs shall vest with the Interim Resolution Professional and the officers and the managers of the ‘Corporate Debtor’ shall report to the Interim Resolution Professional, who shall be enjoined to exercise all the powers as are vested with Interim Resolution Professional and strictly perform all the duties as are enjoined on the Interim Resolution Professional under Section 18 and other relevant provisions of the ‘Code’, including taking control and custody of the assets over which the ‘Corporate Debtor’ has ownership rights recorded in the balance sheet of the ‘Corporate Debtor’ etc. as provided in Section 18 (1) (f) of the ‘Code’. The Interim Resolution Professional is directed to prepare a complete list of inventory of assets of the ‘Corporate Debtor’; The Interim Resolution Professional shall strictly act in accordance with the ‘Code’, all the rules framed thereunder by the Board or the Central Government and in accordance with the ‘Code of Conduct’ governing his profession and as an Insolvency Professional with high standards of ethics and moral and adhere to other provisions of law. It is further directed that the Interim Insolvency Resolution Professional shall positively file a report of events before this Tribunal every seventh day in relation to the ‘Corporate Debtor’. Issues:Transfer of petition from High Court to Tribunal under Insolvency and Bankruptcy Code, 2016; Appointment of Interim Resolution Professional; Suspension of powers of Board of Directors; Duties and powers of Interim Resolution Professional; Constitution of Committee of Creditors; Public announcement of Corporate Insolvency Resolution Process; Appointment of registered valuers for determining liquidation value; Reporting obligations of Interim Insolvency Resolution Professional.Transfer of Petition:The petition was initially filed in the High Court under Sections 433(e) and 434 of the Companies Act, 1956. It was later transferred to the Tribunal under the Companies (Transfer of Pending Proceedings) Rules, 2016. The Tribunal proceeded with the case under Section 7 of the Insolvency and Bankruptcy Code, 2016, and admitted it on 04.09.2017.Appointment of Interim Resolution Professional:Mr. Harish Taneja was appointed as the Interim Resolution Professional for a term of 30 days from the date of his appointment or as determined by the committee of creditors, whichever is earlier. The Interim Resolution Professional was tasked with taking control and custody of the assets of the Corporate Debtor, preparing an inventory of assets, and managing the affairs of the Corporate Debtor in accordance with the Code and relevant provisions.Suspension of Board of Directors' Powers:Upon the appointment of the Interim Resolution Professional, the powers of the Board of Directors were suspended, and the management of the affairs vested with the Interim Resolution Professional. The officers and managers of the Corporate Debtor were directed to report to the Interim Resolution Professional and cooperate in the management of the Corporate Debtor as a going concern.Duties and Powers of Interim Resolution Professional:The Interim Resolution Professional was directed to strictly adhere to the Code, rules framed thereunder, and the Code of Conduct governing the profession of an Insolvency Professional. Additionally, the Interim Resolution Professional was required to constitute the Committee of Creditors within three weeks, make a public announcement of the Corporate Insolvency Resolution Process, and appoint registered valuers to determine the liquidation value of the Corporate Debtor.Reporting Obligations:The Interim Insolvency Resolution Professional was mandated to file a report of events before the Tribunal every seventh day concerning the Corporate Debtor. The orders issued by the Tribunal, including the appointment of the Interim Resolution Professional, were to be communicated to both parties, and the Interim Resolution Professional was to be supplied with copies of the orders.