AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1549
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....ion No.(IB)-1248(PB)/2018. The Appellant in Appeal has prayed for following reliefs : "(a) Direct that the observations made in para. 63, 64 and 67 of the Impugned Order dated 24.07.2024 against the Appellant be expunged; (b) Direct that the concession wrongly recorded on behalf Ld. Counsel of the Appellant in para. 70 of the Impugned Order to the effect that NOIDA would be paid two instalments of lease premium which became due during CIRP as part of CIRP Costs, be expunged; (c) Set aside the Impugned Order dated 24.07.2024 to the extent that it: (i) It directs payments to NOIDA of instalments of lease premium which became due during CIRP as part of CIRP Costs as mentioned in para 79 (h); and (ii) It suo motu replaces the Resolution Professional appointed by the CoC as mentioned in para 79 (b). (d) The Hon'ble Appellate Authority be pleased to pass any other Order in the facts and circumstances of the present Appeal and in the interest of the Justice and Equity." 2. During the course of submissions, learned Counsel for the Appellant has confined his Appeal only to prayer (a). We need to notice the relevant facts and seque....
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....oint the Appellant as RP, which was approved by the Adjudicating Authority on 22.11.2022. On the date when Appellant was appointed as RP, i.e. 21.11.2022, the application filed by erstwhile RP for approval of Resolution Plan was already pending and sub-judice before the Adjudicating Authority. (vii) The Adjudicating Authority after hearing the Noida, passed an order on 29.08.2023, noting two objections raised by the learned Counsel for the Noida. The Appellant filed two additional affidavits dated 16.10.2023 in IA No.3255 of 2020 bringing certain materials facts on record regarding valuation. The Appellant also sent emails to the two Valuers, who were appointed by the earlier IRP. (viii) Again on 31.10.2023, the Adjudicating Authority noticed the submission of the parties and made observations. The parties were permitted to file written submissions, which were filed. (ix) On 17.01.2024, learned Counsel for the RP sought time from the Tribunal to obtain instructions to clarify the issue of valuation. The Appellant filed IA No.506 of 2024 praying for various reliefs including seeking leave of the Tribunal to appoint registered Valuers to submit Valuation Re....
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.... and Mr. Ganesh Chandra Mamgai in the records of the CD. The Appellant has filed the additional affidavit bringing on record all facts and circumstances regarding valuation. The observation of the Adjudicating Authority that the Appellant, who was appointed on 21.11.2022 is filing an Application only in the year 2024 for fresh valuation, as he was oblivious about his duties are unsustainable. When the Application for approval of the Plan before the Adjudicating Authority was being heard and Adjudicating Authority has issued various directions asking the learned Counsel for the RP to explain and clarify, there was no occasion for the Appellant to obtain a fresh Valuation without the leave of the Court and the Appellant as advised has filed an Application seeking various reliefs, including the leave to appoint Valuer. The Appellant in his Application has also prayed that Resolution Plan be remitted back to the CoC for reconsideration. It is submitted that allegations with regard to settlement brought on record in IA No.3926 of 2023 by Ashmeet Singh Bhatia with regard to Shomit Finance Pvt. Ltd., which was approved by the CoC, no exception has been taken to the SRA being a confirming ....
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....ies within the discretion of the Tribunal. 6. The submissions advanced by learned Counsel for the Appellant have been opposed by learned Counsel appearing for Respondent No.6 - Ashmeet Singh Bhatia. It is submitted by Respondent No.6 that Adjudicating Authority was fully entitled to replace the RP owing to various misconduct and illegalities committed by the RP as has been noticed in the impugned order. It is submitted that Gold Star, who is a related party to the SRA has been appointed as the construction Contractor for completion of the balance work of the CD, which had one common Director. The appointment of contractor has been made without the consent of the Homebuyers, merely on the basis of previous engagement of the CoC, in respect of different Towers, however, Gold Star could not have been appointed. The RP has made concealment of the facts qua Shomit Finance Ltd. The RP connived with the Promoters of Shomit Finance Ltd. and SRA and caused wrongful financial gains to them by intentionally causing dishonest and wrongful losses to the CD. The avoidance application was filed by the earlier RP against the transaction with Shomit Finance Ltd., which was withdrawn by the Appel....
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....rom RP qua the present proceedings. It is also quite surprising that how the RP could not take note of the fact that M/s Gold Star Realtors Private Limited, a related party of the SRA, could already be involved as contractor for completion of balance work of the projects qua the Corporate Debtor. Notably, both the SRA and M/s Gold Star Realtor Private Limited have Mr. Rajkumar Ramrakhiyani as their common director. The current RP who had taken over the responsibility on 21.11.2022 could prefer application for fresh valuation only in the year 2024. He could also remain indifferent regarding the inventories and assets of the Corporate Debor like his predecessors." 9. The second observation in paragraph 63 is that RP, who had taken over the responsibility on 21.11.2022, could prefer application for fresh valuation only in the year 2024. 10. Insofar as, the settlement with Shomit Finance Ltd., it is pleaded that after Appellant was appointed as RP, Shomit Finance Ltd. has sent an email to the RP indicating its willingness to resolve the dispute between the CD and itself. After several meetings and discussions, the proposed terms of settlement were incorporated by way of Agreement....
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....er, the resolution, which was approved, clearly provided that RP is authorized to do all acts, deeds, and things as may be required to have the terms of settlement recorded before the Hon'ble NCLT. Thus, filing of the Application before the Adjudicating Authority, bringing settlement on record was with the approval of the CoC, in view of its 25th Meeting and the resolution passed therein. We are of the view that action of RP in bringing the settlement on record, cannot be faulted. Further, the CoC has already resolved, as to how the amount is to be distributed, if received by the CD, no fault can be found with the RP. We make it clear that in the present Appeal, we are not examining the settlement, which was entered with Shomit Finance Ltd., because that is the subject matter of Company Appeal (AT) (Ins.) No.1474 of 2024 and in the present Appeal, we only need to consider the nature of observation and the material available on the record to substantiate the observation made against the Appellant. 12. The Adjudicating Authority has also taken exception to the involvement of the SRA in the Settlement Agreement dated 30.05.2023. It has been observed that 'anything what needed invol....
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....vits dated 16.10.2023, where steps taken by the Appellant regarding valuation have been noticed. It is useful to refer to pleading in paragraph 7.1.14 of the Appeal, which is as follows: "7.1.14 In pursuance to the above, the Appellant filed two Additional Affidavits dated 16.10.2023 in IA 3255/2020, placing on record the true and correct facts as known to the Appellant till that date. Summary of the same is provided below: (i) The Appellant had found two signed valuation reports on record, one dated 07.11.2019 by Mr. Ganesh Chandra Mamgai with respect to land and building, and another dated 22.10.2019 by Mr. Prateek Mittal with respect to securities and financial assets. (ii) The Appellant also found two unsigned valuation reports on record, one by M/s Crest Capital Advisors with respect to both securities and financial assets as well as land and building, and another by Er. Ajay Chaturvedi (apparently on behalf of M/s Tech Mach) with respect to land and building. (iii) Mr. Ganesh Chandra Mamgai and Mr. Prateek Mittal were Registered Valuers, duly registered with the IBBI. Whereas, M/s Crest Capital Advisors and M/s Tech Mach were not registered....
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.... and to that end he wanted accommodation so that on instructions, he can pursue the remedy available as per law." Copy of the Order dated 17.01.2024 passed by the Hon'ble NCLT, Principal Bench is annexed herewith as Annexure - A23." 16. The Appellant thereafter filed an IA No.506 of 2024. The prayers made in IA No.506 of 2024 have been extracted in paragraph 7.1.17, which are as follows: "(a) take on record the final signed valuation report dated 03.10.2023 by Er. Ajay Chaturvedi, obtained by the Applicant subject to approval of this Hon'ble Tribunal; (b) permit the Applicant to appoint a registered valuer to submit valuation report for Financial Assets & Securities; (c) Alternately, permit the Applicant to commission fresh valuation reports of assets of Corporate Debtor in accordance with Regulation 35 of CIRP Regulations; (d) Direct the existing or fresh valuation reports, as the case may be, in light of prayers (a) to (c) above, to be placed before the CoC, if deemed fit by this Hon'ble Tribunal; (e) Pass any such further orders/directions as may be deemed necessary in the facts and circumstances of the case." 1....
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....of the projects qua the CD and both the SRA and M/s Gold Star Realtor Pvt. Ltd. have Mr. Rajkumar Ramrakhiyani as their common Director. With regard to appointment of Gold Star, the RP has pleaded that Gold Star was engaged as Contractor by the CD, even prior to initiation of CIRP and the CoC in different Meetings has already noted and approved the work of Gold Star. The Appellant has referred to 13th Meeting of the CoC held on 26.12.2019, during the period of earlier RP, where Gold Star was one of the three major contractors of the CD and was working with the CD since 01.09.2017 and the IRP has also continued with M/s Gold Star Realtors Ltd. The Appellant has referred to subsequent Meetings of the CoC on 10.01.2020, where a decision was taken by the CoC to continue the Gold Star with construction work on Project site. The relevant parts of the 14th CoC Meeting dated 10.01.2020, are as follows: " CIRP PROGRESS UPDATE : 4. To discuss mechanism to continue construction at the project sites and to take note of the proposals submitted by the contractors namely, M/s GoldStar Realtors Limited, M/s RCB Infra Cons Pvt. Ltd. and M/s Groundwork Concept Pvt. Ltd. for the pur....
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....ours. Agenda items for voting 1. ""RESOLVED THAT the revised quote submitted for undertaking construction by M/s GoldStar Realtors Pvt. Ltd. is approved and M/s Goldstar Realtors Pvt. Ltd is appointed to carry on pending construction in Tower 29, 27, 28 and 14 of Lotus Panache"." Voting of home buyers : Approved with 85% in favour Voting of Noida Authority : Abstain" 20. The Appellant's submission is that the Gold Star has already been carrying out construction work much prior to the appointment of the Appellant as RP and was allowed to complete the construction work in Tower 17, 18 and 19 of the Project. From the materials on record as well as Minutes of the CoC as referred above, it is clear that no exception can be taken by the Adjudicating Authority in permitting the work to be carried on by Gold Star. 21. The submission of learned Counsel for Respondent No.6 that the Adjudicating Authority has ample jurisdiction to replace the RP is supported by the judgment of this Tribunal in Stressed Assets Stabilization Fund (SASF) v. Piyush Periwal & Ors. - Company Appeal (AT) (Ins.) No.947 of 2021. The submission of Respondent No.6 is that RP does n....