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NCLT Mumbai Imposes cost of Rs. 1 Lakh on Resolution Professional for Abusing Dominant Position

Team SoOLEGAL 24 Oct 2019 2:20pm

Image courtesy: btvi.in NCLT Mumbai Imposes cost of Rs. 1 Lakh on Resolution Professional for Abusing Dominant Position

The Mumbai Bench of National Company Law Tribunal has prohibited an Insolvency Resolution Professional (IRP) from carrying on his services as the IRP deliberately failed to take a final decision in regard to the claim of an Applicant against a Corporate Debtor.

An NCLT Bench comprising of Members Bhaskara Pantula Mohan (Judicial) and Shyam Babu Gautam (Technical) also imposed a fine of Rs. 1,00,000/- (Rupees One Lac) upon the IRP for "abusing his dominant position".

The Bench opined that "the Resolution Professional seems to have been sitting over the claim of the Applicant for a long time and this cannot be allowed since the same would cause heavy prejudice to the Applicant and defeat the purpose of the Code."

The Bench was hearing an application under section 60(5) of the IBC, 2016 filed by Amar Universal Pvt. Ltd. in the Company Petition filed by BMW India Financial Services Pvt. Ltd. (Petitioner) against SK Wheels Pvt. Ltd.(Corporate Debtor), wherein the Resolution Professional had been appointed. The Applicant submitted before the Bench that the IRP was not accepting its claim against the Corporate Debtor without even citing any justifiable reasons for the same.

The Resolution Professional had submitted that the Claim of the Applicant was under process and that a part of the Applicant's claim has already been admitted. However, it was noted by the Bench that the claim of the Applicant was filed on 04.06.2019, it had been for months since then but still the Resolution Professional had not yet decided the claim of the Applicant.

It was observed that the Tribunal was provided with wide powers under section 60 (5) of the Code. Therefore, the Bench was of the view that "the actions or rather inactions on the part of the Resolution Professional in not taking a decision with respect to the claim of the Applicant is an abuse of the powers given to him under the code and contrary to justice and public policy. His actions are nothing more but an abuse of his dominant position".

The Tribunal, thus, allowed the misc. application on 16.10.2019 with cost and directed the Resolution Professional to handover the possession of the disputed premises forthwith to the Applicant and pay the claim amount as raised by the Applicant in his claim within a week from the date of the present order.

Tagged: NCLT   IRP   COST   DOMINANT POSITION   IBC  
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