TaxTMI 
TaxTMI 
2025 (11) TMI 524
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....wed the application filed under Section 12A of the I & B Code, 2016, seeking for withdrawal of the CIRP process of the Corporate Debtor, while declining to fix or direct the payment of any fee to the Appellant, who was the Resolution Professional of the Corporate Debtor, for the period during which the CIRP proceedings were directed to be stayed by the Hon'ble High Court of Karnataka, that is, for the period from 14.08.2023 to 18.03.2025. 2. Facts for consideration are, that M/s. Avasarala Technologies Limited, herein the Corporate Debtor was admitted into CIRP proceedings pursuant to an order that, was passed on 04.07.2023, in a proceeding which was drawn against it under Section 9 of the I & B Code, 2016, by M/s. Thyssenkrup Automation Engineering GmbH, Germany, the Operational Creditor. 3. Brief facts are that, as a consequence of the initiation of the CIRP process, the Appellant was appointed as IRP and that he took over the CIRP-related responsibilities of the Corporate Debtor, including taking charge of the operations of the Corporate Debtor, issuing public announcements, constituting the CoC and convening of the first CoC meeting, as was scheduled for 17.08.2023. Howev....
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....ed to be held on 17.08.2023, could not be proceeded with owing to the interim order of Hon'ble High Court dated 14.08.2023, other functions as alleged to have been performed by the Interim Resolution Professional, the Appellant herein couldn't be said to have been performed at all, due to the restrictions imposed by the interim order passed by the Hon'ble High Court of Karnataka, because such other acts as alleged to have been carried thereafter by IRP would be an act under contempt of the order of Hon'ble High Court. 8. Be that as it may, the interim order as granted on 14.08.2023, admittedly continued to operate, till the writ petition was withdrawn, by filing the memo, dated 18.03.2025 and the CIRP process is said to have resumed only after 18.03.2025. Meaning thereby, in between the period from 14.08.2023 and 18.03.2025, no functions could have been at all discharged by the Appellant because, according to his own case, he had issued public announcement and was about to convene the 1st CoC, which was scheduled to be held on 17.08.2023, which was thwarted due to the grant of the interim order of 14.08.2023, by the Hon'ble High Court of Karnataka. 9. The Oper....
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....r orders as this Hon'ble Tribunal may deem fit in the facts and circumstances of the case, in the interest of justice and equity. 12. The Ld. Tribunal had considered the aspect, as to what implications would the stay order have pertaining to the fee and expenses, which has been claimed by the Appellant and as to whether, the stay of the proceedings by the Hon'ble High Court of Karnataka by its order of 14.08.2023, would amount to a stay of the CIRP process. The Appellant, before the Ld. Tribunal had admitted the fact that the CIRP did commence on 04.07.2023 when he was appointed as an Interim Resolution Professional pursuant to the application preferred by the promoters, and that the proceedings of the CIRP were kept in abeyance. Hence, he submitted that the stay of the proceedings by the Hon'ble High Court will not amount to be the stay of the process of CIRP. 13. Besides that, he also submitted that, the fixation of the fee, that is payable to him, may not be less than the threshold fee as it has been provided under Regulation 34B of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which mandates the process of fixation of the Interi....
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....to be drawn by the Appellant between the terms "stay of proceedings" and "stay of CIRP", was absolutely an irrational interpretation because a stay of proceeding will amount to be the stay of the CIRP process, which was a subject matter of consideration before the Hon'ble High Court Karnataka. 18. And thus, it was rightly observed by the Ld. Tribunal, that as a matter of fact, there is no practical or rational distinction between the two terms of "stay of proceedings" and "stay of the CIRP", because the ultimate conclusion of either of the two expressions, for which the distinction was attempted to be drawn by the Appellant, would be the same, and therefore, the period from 14.08.2023 till 18.03.2025 would be an exclusion period, where no work relating to CIRP could not have possibly been carried out by the IRP, Ld. Tribunal further observed that had the CIRP proceeded further, consequent to vacation of stay, that stood imposed by the Hon'ble High Court's order of 14.08.2023, the IRP would have applied for exclusion of such period from CIRP timelines and that if the Appellant in the capacity of being an IRP on his volition has been filing applications including the progr....