2020 (11) TMI 242

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....lution to approach the Central Government for its approval with regard to the remuneration of the Applicant passed in the seventh meeting of the Committee of Creditors held on 30.08.2018 and declare the same as arbitrary and illegal; ii. Consequently direct the Resolution Professional/ Respondent herein to comply with the directions of the Committee of Creditors in the meeting held on 26.04.2018 to make an application to the Central Government seeking approval for the remuneration paid to the Applicant; iii. Reimburse the legal expense incurred by the Applicant having been compelled to file this grievance before this Adjudicating Authority which was totally avoidable. 2. Brief facts of the instant Application are as und....

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....rate Debtor as Executive Director, the Corporate Debtor addressed a letter dated 31.07.2017 to the lead member of the consortium i.e., State Bank of India seeking No Objection Certificate ("NOC") from the lenders for managerial remuneration to be filed with Central Government. In view of the aforementioned approvals, the lead lender i.e., State Bank of India also addressed a letter to all the committee members of JLF on 02.08.2017, seeking their approval for issuance of NOC in relation to the remuneration of the Applicant. c. That in anticipation of obtaining the approval from the Central Government and in view of the recommendations of Ernst and Young (agency appointed for Interim Management Support Services by the Consortium) to ....

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....CoC"). g. That it was confirmed by the Respondent by his email dated 21.05.2018, that the CoC in its Second meeting held on 26.04.2018, approved the payment of pending salary of the Applicant for the months of February and March, 2018 and also asked the Respondent to avail the services from the Applicant as an employee of Corporate Debtor at the same level of remuneration and also directed the Respondent to refer the matter to the Central Government for approving the payment of salary for the period 1st June, 2017 to 23rd January, 2018. The same was acknowledged by the Applicant by his email dated 22.05.2018. h. That despite aforementioned approval by the COC the Respondent did not release the salary of the Applicant. As s....

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....e directions given by the COC in its 2nd meeting. j. Reiterating above, Ld. Counsel for the Applicant prayed to allow the Application as prayed for. 3. Counsel for the RP filed counter and written submissions, inter-alia, stating as under:- i. That the Corporate Debtor and the Applicant had agreed on a remuneration of INR 74,98,704 to be paid by the Corporate Debtor for the services to be rendered by the Applicant ("Remuneration"). In view of the Remuneration being higher than the amount prescribed under Section 197(1) of the Companies Act, 2013, the Corporate Debtor was required to get an approval of the Central government to pay such Remuneration to the Applicant. ii. That the Corporate Debtor proceeded on th....

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.... Debtor. The Applicant had not received the salary payable to him for the months of February and March 2018. At the second COC meeting held on April 26, 2018 the COC suggested to the Resolution Professional to approach the Central Government for the payment of remuneration to the Applicant. However, no resolution authorizing the Resolution Professional to seek such approval was passed by the COC. Further, the COC asked the Resolution Professional to continue availing the services of the Applicant during the CIRP. v. That the Resolution Professional informed the COC at its sixth meeting held on August 7, 2018 that for the purpose of making the requisite Application for the approval of the Central Government under section 197(1), a R....