Insolvency petition for disputed professional fees not maintainable, though a limited equitable direction was made for payment consideration.

A Section 9 petition under the Insolvency and Bankruptcy Code, 2016 seeking recovery of disputed professional fees was held not maintainable because the proceeding could not be used as a recovery mechanism for contested service claims, especially where the company disputed liability and asserted prior payments toward services and expenses. The authority nevertheless noted the professional's long association with the company and, in the interest of justice, issued a limited equitable direction for the corporate debtor to sympathetically consider payment of a reasonable amount for the services rendered.

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Issues: Whether the petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 for recovery of professional fees was maintainable, and whether any relief could nevertheless be granted.

Analysis: The claim arose from professional services rendered in connection with tax assessment proceedings and was disputed on the ground that payments had already been made towards services and expenses. The petition was found not maintainable under the Insolvency and Bankruptcy Code, as the proceeding could not be used as a recovery mechanism for the disputed professional claim. At the same time, the authority noted the petitioner's long association and service to the company and invoked its inherent powers to issue a limited equitable direction in the interest of justice.

Conclusion: The petition was not maintainable on merits under Section 9 of the Insolvency and Bankruptcy Code, 2016, but a limited direction was issued to the corporate debtor to sympathetically consider payment of a reasonable amount for the services rendered.

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