Insolvency & Bankruptcy Board of India v. WIG Associates (P) Ltd. & Ors.

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The Tax Publishers 2018 TaxPub(CL) 0959 (NCLAT-Del) : (2018) 210 CompCas 0103 : (2018) 145 CLA 0532 Insolvency & Bankruptcy Board of India v. WIG Associates (P) Ltd. & Ors. INSOLVENCY AND BANKRUPTCY CODE, 2016, --Appeals and Appellate Authority --Appeal against finding of Adjudicating Authority in relation to interpretation of section 29A IBBI having no locus standi* to file appeal --Duty of resolution professional to bring it to notice of Appellate Authority by preferring an appeal--Where IBBI filed an appeal under section 61 against finding of Adjudicating Authority in relation to interpretation of section 29A, which was neither correct nor proper, which resulted in selection of an ineligible resolution applicant and further resulted in approval of an ineligible resolution plan, but it was the duty of resolution professional to bring it to notice of Appellate Authority by preferring an appeal, thus, the appeal at the instance of IBBI could not be entertained.--Resolution applicant was related to promoter directors of corporate debtor. It had submitted resolution plan contrary to section 29A, which was approved by Committee of Creditors (CoC). Further that, Adjudicating Authority also approved the resolution plan. IBBI filed an appeal under section 61, wherein it averred that finding of the Adjudicating Authority in relation to interpretation of section 29A was neither correct nor proper, which resulted in selection of an ineligible resolution applicant and further resulted in approval of an ineligible resolution plan. Held:* IBBI having no locus standi could not challenge the finding, as it could monitor performance of insolvency professionals and in appropriate cases, might pass any direction as might be required for compliance with the provisions of the Code. It was the duty of resolution professional (RP) under section 30(2) to find out which of the resolution plans was in conformity with the provisions prescribed. If the interpretation of section 29A was against the provisions of the Code and was against the legislative intent, then, it was the duty of the RP to bring it to the notice of the Appellate Authority by preferring an appeal. Hence, the appeal at the instance of IBBI could not be entertained. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers 2018 TaxPub(CL) 0959 (NCLAT-Del) : (2018) 210 CompCas 0103 : (2018) 145 CLA 0532

Insolvency & Bankruptcy Board of India v. WIG Associates (P) Ltd. & Ors.

INSOLVENCY AND BANKRUPTCY CODE, 2016,

--Appeals and Appellate Authority --Appeal against finding of Adjudicating Authority in relation to interpretation of section 29A IBBI having no locus standi to file appeal --Duty of resolution professional to bring it to notice of Appellate Authority by preferring an appeal--Where IBBI filed an appeal under section 61 against finding of Adjudicating Authority in relation to interpretation of section 29A, which was neither correct nor proper, which resulted in selection of an ineligible resolution applicant and further resulted in approval of an ineligible resolution plan, but it was the duty of resolution professional to bring it to notice of Appellate Authority by preferring an appeal, thus, the appeal at the instance of IBBI could not be entertained.--Resolution applicant was related to promoter directors of corporate debtor. It had submitted resolution plan contrary to section 29A, which was approved by Committee of Creditors (CoC). Further that, Adjudicating Authority also approved the resolution plan. IBBI filed an appeal under section 61, wherein it averred that finding of the Adjudicating Authority in relation to interpretation of section 29A was neither correct nor proper, which resulted in selection of an ineligible resolution applicant and further resulted in approval of an ineligible resolution plan. Held: IBBI having no locus standi could not challenge the finding, as it could monitor performance of insolvency professionals and in appropriate cases, might pass any direction as might be required for compliance with the provisions of the Code. It was the duty of resolution professional (RP) under section 30(2) to find out which of the resolution plans was in conformity with the provisions prescribed. If the interpretation of section 29A was against the provisions of the Code and was against the legislative intent, then, it was the duty of the RP to bring it to the notice of the Appellate Authority by preferring an appeal. Hence, the appeal at the instance of IBBI could not be entertained.