In the case of Mr. Rohit Vora (Insolvency Professional) Disciplinary Committee (DC) of IBBI has identified multiple contraventions, including non-submission of required forms, lack of cooperation with investigating authorities, and non-compliance with disclosure requirements. These violations undermine transparency, accountability, and the regulatory framework established under the Code and relevant regulations. Mr. Vora’s (Insolvency Professional) failure to respond to the Investigating Authority is a direct violation of regulations and clauses related to communication with the Board. Such non-cooperation cannot be taken lightly, and a strong message must be sent to regulated professionals regarding the importance of responding to the Board’s communication.
Contravention – I: In this section, it is noted that Mr. Vora failed to cooperate with the Investigating Authority (IA) during the investigation process. Despite multiple requests for a specific response and relevant records, Mr. Vora only referred to an advisory and challenged the order of the AA before the Hon’ble NCLAT. This non-cooperation contravenes regulations related to the submission of records and the duty to cooperate with the IA. As a result, the Board has prima facie concluded that Mr. Vora contravened the relevant sections and regulations.
Contravention – II: The AA made adverse comments against Mr. Vora for charging excessive fees during the Covid-19 period, which the AA deemed unreasonable. The Code of Conduct requires that fees be charged in a transparent manner and be reasonable. Mr. Vora claims that the matter is sub judice as an appeal has been filed with the Hon’ble NCLAT. Considering the ongoing legal proceedings, the DC refrains from commenting on this matter.
Contravention – III: Mr. Rohit Vora’s conduct during the CIRP is questioned in this section. The AA observed that he orally opposed the liquidation application he himself filed and handed over the custody of the corporate debtor (CD) to the ex-management, which is inconsistent with his duty as a Resolution Professional (RP). These actions are in contravention of relevant sections, regulations, and clauses of the Code of Conduct. Mr. Vora defends his actions, stating that certain observations were based on oral deliberations and that he did not give custody to the ex-management.
Contravention – IV: In this section, it is noted that Mr. Vora failed to submit Relationship Disclosure Forms and Cost Disclosure Forms in a timely manner as required by regulations and circulars. The delay in submission raises concerns about transparency and accountability in the insolvency resolution process. By not making the required disclosures on time, Mr. Vora has violated relevant sections, regulations, and clauses related to disclosure requirements.
Contravention – V: It is observed that Mr. Vora did not submit certain CIRP forms, namely CIRP 4, 5, 6, and 8, to the Board as required by the regulations. These forms contain important information and records related to the corporate insolvency resolution process. The non-submission of these forms within the specified timelines is a violation of the relevant sections, regulations, and clauses related to filing requirements.
Conclusion: Based on the submission made by Mr. Vora and the available materials, the DC concludes that Mr. Vora has contravened regulations and clauses related to cooperation during investigation, excessive fees claimed as an RP, and inconsistency in actions and custody of the CD. However, some matters are sub judice, and further adjudication is required to determine the final outcome. It is further observed that Mr. Vora has contravened regulations and clauses related to the non-submission of Relationship and Cost Disclosure Forms, as well as the non-submission of certain CIRP forms to the Board. These contraventions raise concerns about transparency, accountability, and adherence to regulatory requirements. Consequently, his registration is suspended for a period of one year, in accordance with the powers conferred under the Code and the applicable regulations. This order will come into force after 30 days from the date of issuance. Furthermore, the DC also highlights the non-cooperation of a CoC member, Religare Finvest Ltd., which has significantly impacted the resolution process.
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
This Order disposes the Show Cause Notice (SCN) No. COMP-11012/259/2022-IBBI/752/592 dated 16.05.2023 issued to Mr. Rohit Vora Insolvency Professional under section 220 of the Insolvency and Bankruptcy Code, 2016 (Code) read with regulation 13 of the Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017 (Inspection and Investigation Regulations). Mr. Rohit Vora is a Professional Member of Insolvency Professional Agency (IPA) of the Insolvency Professional Agency of Institute of Cost Accountants of India (IPA-ICAI) and an Insolvency Professional (IP) registered with the Insolvency and Bankruptcy Board of India (Board) with registration No. IBBI/IPA-003/IP-N00071/2017-18/10556.
1. Developments in relation to resolution/liquidation of the CDs
1.1. The Hon’ble NCLT, Mumbai Bench (AA) vide order dated 25.04.2019 admitted the application under section 7 of the Code filed by the financial creditor Dena Bank, for initiating Corporate Insolvency Resolution Process (CIRP) of Jogma Laminates Industry Private Limited (CD) where Mr. Rohit Vora was appointed as the Interim Resolution professional (IRP) and later confirmed as Resolution Professional (RP) by CoC in its first meeting dated 24.05.2019. Further in 3rd CoC meeting dated 18.07.2019, resolution was passed by CoC to change RP but no application was filed before AA for replacement of RP and Mr. Vora continued to work as RP till passing of the liquidation order by AA . on 16.11.2022 where Mr. Rajas Shreeram Bodas was appointed as liquidator.
2. Issuance of Show Cause Notice (SCN) and hearing before DC
2.1. The Board, in exercise of the powers conferred to it under section 218 of the Code read with the Inspection and Investigation Regulations, appointed an Investigating Authority (IA) to conduct the inspection of Mr. Rohit Vora in CIRP of CD. The IA served notice of investigation as per regulation 8(1) of the Inspection and Investigation Regulations on 27.12.2022. IA submitted investigation report to the Board on 24.04.2023.
2.2. Based on the material available on record including the Investigation Report, the Board issued the SCN to Mr. Rohit Vora on 16.05.2023. The SCN alleged contravention of sections 25(1), 33(2), 208(2)(a) & (e) of the Code, regulations 8(4) and 8(8) of Inspection and Investigation Regulations, regulation 34A and 40B of the IBBI (Resolution Process for Corporate Insolvency) Regulations, 2016 (CIRP Regulations), regulation 7(2)(a) & (h) of the IBBI (Insolvency Professionals) Regulations, 2016 (IP Regulations) read with clauses 1, 3, 5, 8C, 13, 15, 18, 19, 25, 25A and 27 of the Code of Conduct as specified in the First Schedule of IP Regulations (Code of Conduct)., Circular No. IP/005/2018 dated 16.01.2018, Circular No. IBBI/IP/013/2018 dated 12.06.2018 and Circular No. IBBI/CIRP/023/2019 dated 14.08.2019. Mr. Rohit Vora replied to the SCN on 30.05.2023.
2.3. The Board referred the SCN, written submissions of Mr. Rohit Vora, and other material available on record to the Disciplinary Committee (DC) for disposal of the SCN in accordance with the Code and Regulations made thereunder.
2.4. Mr. Rohit Vora availed an opportunity of personal hearing before DC on 16.06.2023 through virtual mode where he was also represented by Mr. Abhishek Anand, Advocate. Mr. Rohit Vora submitted further written submissions on 16.06.2023, 19.06.2023 and 23.06.2023.
3. Alleged contraventions and submissions of the IP
Contraventions alleged in the SCN and Mr. Rohit Vora’s submissions thereof are summarized below:
Contravention – I
3.1. Non-cooperation to the IA in conduct of investigation.
3.1.1. It is observed that a notice of investigation was issued on 27.12.2022 by IA requesting Mr. Rohit Vora to provide response to the observations made against him by AA in its order dated 06.12.2022. However, in response to the said notice of investigation, vide email dated 01.01.2023, Mr. Rohit Vora referred to an advisory issued by the Board based on an inspection conducted in the said matter and he failed to provide any specific response. IA again vide email dated 22.03.2023 sought his response, however, vide email dated 23.03.2023 instead of submitting required reply, Mr. Rohit Vora informed that the said order of the AA has been challenged by him before the Hon’ble NCLAT. Subsequently, vide email dated 23.03.2023 Mr. Rohit Vora was requested by the IA to provide a copy of the appeal filed before the Hon’ble NCLAT. However, no further response were received from Mr. Vora. The IA after awaiting response from Mr. Vora, was constrained to submit the Investigation Report on 24.04.2023.
3.1.2. Regulation 8(4) of the Inspection and Investigation Regulations provides that it shall be the duty of the service provider to produce records in his custody or control and furnish to the IA. Regulation 8(8) of the Inspection and Investigation Regulations requires the IP to give to the IA all assistance which the IA may reasonably require. Clause 18 of the Code of Conduct as specified in the First Schedule of IP Regulations (Code of Conduct) also requires that the IP must cooperate and be available for investigation carried out by the Board. In view of the foregoing, it is evident that Mr. Rohit Vora has not cooperated with the IA in submission of specific response to the observations of AA and relevant records for investigation, thereby, frustrating the entire process.
3.1.3. In view of the above, the Board held the prima facie view that Mr. Rohit Vora has contravened sections 208(2)(e) of the Code, regulation 8(4) and 8(8) of Inspection and Investigation Regulations, regulation 7(2)(h) of the IP Regulations read with clauses 18 and 19 of the Code of Conduct.
3.2. Submissions made by Mr. Vora.
3.2.1. Mr. Rohit Vora referred to regulation 6 of the Inspection and Investigation Regulations and submitted that he has not received any draft inspection report for investigation notice dated 27.12.2022. Non availability of inspection report is preventing him to justify and clarify IA for removal of doubts, if any. He further submitted that he straightaway received investigation report and no draft investigation report was ever served to him as provided under regulation 6 of Inspection and Investigation Regulations. Thus, present SCN is devoid of any merit and cannot be proceeded further.
3.2.2. Mr. Rohit Vora further referred advisory no. IBBI/IP/INSP/2021/86/3427/541 dated 18.07.2022 regarding Inspection Order dated 09.07.2021 and submitted that all the relevant details relating to the process are available with the Board.
3.2.3. Mr. Rohit Vora submitted that the allegation of non-cooperation is not valid as he uploaded every documents time to time during CIRP along with all above annexures and minutes of meeting and submitted all papers and proceedings of Hon’ble NCLAT as required by the Investigating Authority vide email dated 23.03.2023 to the IA.
3.3. Analysis And Findings.
3.3.1. The DC notes that Mr. Rohit Vora was sent notice of investigation vide email dated 27.12.2022 as per regulation 8(1) of the Inspection and Investigation Regulations. Hence,
it is clear that investigation was initiated against Mr. Rohit Vora and not inspection.
3.3.2. In this regard, the DC refers to regulation 10 of the Inspection and Investigation Regulations which reads as under:
10. Investigation Report.
(1) The Investigating Authority shall submit the investigation report to the Board.
(2) The Board shall examine the investigation report as to whether investigation is complete and satisfactory or requires further investigation and advise the Investigating Authority accordingly within 15 days of receipt of the investigation report.
(3) After taking into account advice of the Board, the Investigating Authority shall prepare the investigation report and submit it to the Board.
The above provision does not provide for any draft investigation report to be shared with any IP for comments. Considering submissions of Mr. Rohit Vora, it is apparent that he is confusing between investigation and inspection and fails to differentiate between them. Such confusion and non-clarity regarding provisions of the Regulations is not expected from an IP.
3.3.3. The DC further notes from the conduct of Mr. Rohit Vora that he did not provide any reply to the issue raised in the notice of investigation. Instead, he referred to his earlier inspection to refer the documents. The said inspection dated 09.07.2021 was closed by issuance of advisory dated 18.07.2022 and it was not pertaining to the observations by AA in its order dated 06.12.2022, The IA had sought information from Mr. Vohra with respect to observations by AA in its order dated 06.12.2022, which cannot have any link to advisory of the Board dated 18.07.2022 Therefore, the subject of investigation pertained to events transpired after the aforesaid closed inspection. Further, Mr. Rohit Vora also did not submit copy of appeal filed before Hon’ble NCLAT to the IA. The same was submitted to this DC on 19.06.2023 when asked for during the personal hearing on 16.06.2023. Considering whole chain of events, the DC finds Mr. Rohit Vora to be in contravention of sections 208(2)(e) of the Code, regulation 8(4) and 8(8) of Inspection and Investigation Regulations, regulation 7(2)(h) of the IP Regulations read with clauses 18 and 19 of the Code of Conduct for belligerent non-cooperation with IA.
Contravention – II
4.1. Excessive Fees claimed as RP.
4.1.1. It is observed that the AA in its order dated 06.12.2022 made adverse comments against Mr. Rohit Vora for charging same fees for the Covid-19 period as he was charging during normal period which reads as under :
“The only contention of Mr. Partho Sarkar, counsel appearing for the RP is that even though the COC has resolved to replace the RP with Mr. Rajat Naidu in the third COC meeting held on 18.07.2019, no such application was filed by the COC for change of RP and therefore the present RP is entitled for the agreed fee till the RP was discharged through an order of this tribunal. In the present application, the RP is claiming an amount @ 3.75 lacs per month both for himself and his team besides expenses in a sum of Rs. 1,68,60,372/- without doing any work. The RP cannot claim fee by taking advantage of the inaction of the COC in filing an application for his replacement nor on certain observations made in MA 3399/2019 as the above MA was filed for fee and expenses during the active period of CIRP. This Bench made certain observations in M.A. 3399/2019 since the COC is objecting for payment of fee and expenses of the team of RP even during the active CIRP period which was the lis in M.A 3399/2019. The Applicant cannot claim the same amount for subsequent period even without considering Covid circumstances etc. by taking advantage of certain observations in M.A. 3399/2019.
5. It is also pertinent to observe here that the Resolution Professional has already claimed his fee and expenses till 31.08.2019 in the earlier M.A. 3399/2019 and in the present I.A. 1312/2022, he claimed fee and expenses from 24.04.2019 to 24.04.2022 under Exhibit ‘A’ of the present application. The Resolution Professional has already claimed the expenses of Rs. 1,50,000/- for preferring M.A. 3399/2019 which was allowed by this Bench. Surprisingly, he claimed another 7,95,407/- towards legal fee and expenses for moving the present I.A. for the same relief of payment of fee. It is an admitted fact that human life was completely paralyzed, business activities, production, transport everything has come to standstill all over globe due to COVID-19 pandemic from 25.03.2020 till the end of 2021 due to three waves of COVID. This tribunal is unable to understand how the RP can claim fee not only for himself but also his team for the COVID period more so by creating a tussle between the COC and himself with regard to way forward of the CIRP process.
… This Bench has taken a very serious note about the conduct as well as the way of charging fee by RP without doing any work.”
4.1.2. Clause 25 of the Code of Conduct requires that an IP must provide services for remuneration which is charged in a transparent manner, is a reasonable reflection of the work necessarily and properly undertaken and is not inconsistent with the applicable regulations. Also, the Clause 27 of the Code of Conduct requires that an IP shall disclose all costs towards the insolvency resolution process costs, liquidation costs, or costs of the bankruptcy process, as applicable, to all relevant stakeholders, and must endeavour to ensure that such costs are not unreasonable.
4.1.3. The Board held a prima facie view that by claiming fee at the same rate for the period when the workload was significantly reduced, as observed by the AA, Mr. Rohit Vora has contravened sections 208(2)(a) & (e) of the Code and clauses 25 and 27 of the Code of Conduct.
4.2. Submissions made by Mr. Vora.
4.2.1. Mr. Rohit Vora submitted that with respect to observations made by AA in order dated 06.12.2022 regarding fees of Rs. 1 lakh per month on his claim of Rs. 3.75 lakhs per month is sub judice, as both the parties have appealed against the order the said order of AA before Hon’ble NCLAT.
4.2.2. Mr. Rohit Vora submitted that order of AA dated 06.12.2022 was received by him on 10.12.2022, based on which the SCN is issued, and investigation proceedings are also initiated. He submitted that every order of AA can be challenged before Hon’ble NCLAT within 30 days from the date of order as per section 61(2) of the Code. In this case he has challenged the aforesaid order before Hon’ble NCLAT vide appeal no. 104/2023 dated 05.01.2023 which is still pending adjudication. He submitted that it is his constitutional as well as statutory right to appeal and clarify the things in effective manner. As last date of filling appeal was 06.01.2023 and he had to file the appeal, therefore, most of effective time was consumed in preparing for the appeal. Further, without expiry of said limitation of appeal period, i.e., of 30 days. he received email for investigation from the Board on 27.12.2022 to submit the details for investigation based on AA’s order dated 06.12.2022. Since the same is challenged and pending adjudication, adverse remarks are sought to be expunged and same has not attained finality. A copy of appeal was already provided to IA on 30.05.2023.
4.2.3. Mr. Rohit Vora submitted that he is ready to accept whatever outcome is from said proceedings. He submitted that from 24.04.2019 till date he has protected good resolution-oriented assets of the CD and paid Rs. 11,65,428/- (Rs. 5,67,590/- out of his own pocket) for security persons and other expenses. He submitted that CoC approved the figure of Rs. 3.75 lacs in first meeting and therefore on that basis he claimed the amount for relevant period of CIRP of CD.
4.3. Analysis and Findings.
4.3.1. The DC notes that the CIRP had not moved towards resolution as no Form G or Expression of Interest was published and AA vide its order dated 06.12.2022 observed that Mr. Rohit Vora is claiming high fees for Covid period. AA fixed the fees of RP as Rs. 1 lakh per month from 01.09.2019 to 24.04.2022 along with actual expenses for protecting the property against production of bills. Mr. Rohit Vora has challenged the said order of AA before Hon’ble NCLAT vide appeal numbered as CA(AT)(Ins) 104/2023 which is pending for adjudication. Hence, the DC refrains from commenting on a matter which is sub judice.
Contravention – III
5.1. Inconsistency in action and handing over custody to ex-Management.
5.1.1. It is observed that the AA vide its order dated 06.12.2022 made disapproving remarks in regard to Mr. Rohit Vora’s conduct of the CIRP stating that he orally opposed the liquidation application filed by himself and he also handed over custody of the CD to ex-management. The AA made the following observations-:
“This bench also observes that the RP having filed an application for liquidation orally opposed for passing an order of liquidation contending that the Corporate Debtor is viable for resolution. The major COC member is alleging that the RP has handed over interim custody of the Corporate Debtor to the members of the suspended board which is not denied by RP. This Bench has taken a very serious note about the conduct as well as the way of charging fee by RP without doing any work.”
5.1.2. On perusal of extract of CoC minutes mentioned in order of liquidation dated 16.11.2022 passed by AA, it is noticed that the proposal for filing for liquidation of the CD and Mr. Rohit Vora’s appointment as liquidator has been deferred by the CoC by deciding to first file a petition for change of RP and then initiate liquidation proceedings. However, Rohit Vora filed a liquidation application and during the hearing orally opposed the liquidation of the CD, and the same was recorded in the order of AA dated 06.12.2022. AA in its liquidation order also noted contention of Mr. Vora that the CD is viable and resolution is possible. Thus, there is inconsistency in his action as while Mr. Rohit Vora filed an application for liquidation of the CD without the consent of CoC but orally opposed it during hearing believing that CD can be resolved.
5.1.3. It is also noted on perusal of order dated 06.12.2022 of the AA that Mr. Rohit Vora relinquished his independence and forsaken his primary duty to protect and preserve the assets of the CD as he handed over interim custody of the CD to the suspended board of the CD. This is in contravention of section 25(1) of the Code which provides that it shall be the duty of the RP to preserve and protect the assets of the CD, including the continued business operations of the CD.
5.1.4. In view of the above, the Board held the prima facie view that Mr. Rohit Vora has contravened section 25(1), 208(2)(a) & (e) of the Code, regulation 7(2)(a) & (h) of the IP Regulations read with clauses 1, 3 and 5 of the Code of Conduct.
5.2. Submissions made by Mr. Vora.
5.2.1. Mr. Rohit Vora submitted that those discussions in aforesaid order are part of oral deliberations between the Bar and Bench while arguing a case and such observations made were suggested by counsel for major CoC member about grant of interim custody to the suspended management is completely an eye wash, as in the 2nd CoC meeting it was recorded in the minutes of meeting that suspended management has cooperated and granted access to the plant however, the said counsel cleverly misused and impressed upon AA to portray that he has given interim custody to suspended management. He submitted that ex-management was never given any custody, it was just when the ex-management granted access to plant and other data it is being misrepresented that he was running plant through them or any custody was given to ex-management.
5.2.2. Mr. Rohit Vora submitted that AA’s order dated 10.11.2022 in MA no 3399/2019, AA itself considered that from the record it is not appearing that RP has not taken any custody of the assets of the CD. The Para of Court order is as under:
“9. After hearing the above submissions on both sides and upon perusing the material available on record, this Bench observes that no resolution has taken place even after lapse of more than two and half years after passing the CIRP order in this case. The CIRP process has come to a standstill because of the tussle between the RP and CoC. This Bench further observes that even though the COC is raising the above allegations against the RP, nothing was reduced into writing of the above allegations against the RP in any of the COC meetings as appearing from the minutes. On the other hand, it was recorded in the second COC meeting dated 14.06.2019 that the RP has informed the COC to the fact that the suspended directors of the CD has provided access to the corporate debtors Books of accounts. It is also observed that the original lender, Religare Fin serve Limited expressed their inability to provide Interim finance & requested the RP to proceed ahead with regular statutory audit and not to proceed with forensic audit. If at all the CoC is unhappy about the conduct of RP or dereliction of duty on the part of the RP, They are liberty to report the matter to IBBI for initiating disciplinary proceedings against RP. Since the CoC has resolved to change the RP, the present RP is not questioning the resolution nor the power of CoC except claiming his fees. The CoC having agreed to continue the present RP till the new RP is appointed on the same terms, Now cannot deny his fees and expenses on flimsy ground which were not borne on Record.”
5.2.3. Mr. Rohit Vora further submitted that in the view of the inaction on part of CoC, he was left with no practical functionality, and nothing other than liquidation survives. The Code casts incumbent duty on an RP that he should not work only for the interests / benefits of the CoC or CD but in the best interest of all stakeholders. The concrete objective of the Code is to resolve the CD in the best interest of all stakeholders and liquidation to deployed as last resort when all possible routes are extinguished. Being the RP of CD, he worked in the same line to maximize the value of CD and proposed to get a resolution plan. Further it is a duty of the RP to work in the direction to get the CD be resolved, but if CoC prohibits the RP to perform his duties by not publishing Form G etc. then there no possibility for resolution. As a result, in compulsion RP has to file liquidation application being considering timeline and pressure of CoC.
5.3. Analysis and Findings
5.3.1. The DC notes that the on the basis of allegations made by CoC member, AA observed that on behalf of the RP objection was not raised. There is no proof is on record to substantiate the allegation. Furthermore, in appeal submitted to Hon’ble NCLAT prayer has been made to quash the order of the AA in entirety, therefore, DC finds no reason to take this alleged contravention in reckoning as matter being sub judice.
Contravention – IV
6.1. Non-submission of Relationship and Cost Disclosure Forms
6.1.1. Regulation 34A of the CIRP Regulations provides that the IRP or RP, as the case may be, shall disclose item wise insolvency resolution process costs in such manner as may be required by the Board. Also, the IBBI Circular No. IP/005/2018 dated 16.01.2018 on ‘Disclosures by Insolvency Professionals and other Professionals appointed by Insolvency Professionals conducting Resolution Processes’, specifies that, an IP shall ensure disclosure of the relationship, if any, of the other professional engaged by him to the Insolvency Professional Agency (IPA) of which he is a member, within the time specified. The same is reiterated in the clause 8C of Code of Conduct which states that an IP shall ensure disclosure of the relationship of the other professionals to the IPA of which he is a member and clause 19 of the said Code of Conduct also dictates an IP to provide all information and records as may be required by the Board or the IPA with which he is enrolled.
6.1.2. It is observed that there was delay in the submission of Relationship Disclosure of various professionals appointed Mr. Vora to the IPA which is as under :
|Details||Date of Appointment||Date of Submission||To be filed within
(As per IBBI circular
|Delay (in days)|
|Other Professional (Technical Person- Ambaselkar Associates LLP)||15.06.2019||25.12.2020||3 days from date of appointment||555|
|Mr. Rohit Vora (RP)||30.05.2019||31.07.2019||3 days from date of appointment||58|
|Mr. Rohit Vora (IRP)||25.04.2019||30.05.2019||3 days from date of appointment||31|
6.1.3. Further, the IBBI Circular No. IBBI/IP/013/2018 dated 12.06.2018 on ‘Fee and other Expenses incurred for Corporate Insolvency Resolution Process’, mandated IP to disclose fee and other expenses in the relevant Form to the IPA of which he is a member for all concluded CIRPs and for ongoing and subsequent CIRPs within the time as specified in the relevant Form. It is observed that Mr. Rohit Vora demitted office as RP on passing of the liquidation order dated 16.11.2022. However, Form-III of Cost Disclosure was not submitted by him which was to be submitted by the RP within seven days of his demitting office as RP.
6.1.4. An IP is obliged under the Code to take reasonable care and diligence while performing his duties, including making timely disclosures to ensure transparency and accountability. Hence, by failing to make timely relationship disclosure of the professionals appointed by Mr. Vora and the cost disclosure, a doubt is cast on the transparent conduct of the processes under the Code.
6.1.5. In view of the above, the Board held the prima facie view that Mr. Rohit Vora has inter alia violated section 208(2)(a) & (e) of the Code, regulation 34A of the CIRP Regulations and regulation 7(2)(h) of IP Regulations read with clause 8C, 13, 19 and 25A of the Code of Conduct also read with circular No. IP/005/2018 dated 16.01.2018 and Circular No. IBBI/IP/013/2018 dated 12.06.2018.
6.2. Submissions made by Mr. Vora.
6.2.1. Mr. Rohit Vora submitted that said forms were received belatedly and thus uploaded belatedly. He agreed that some of the disclosures are not filed on time being as it was his first case of the CIRP. He further submitted that all the Forms are duly filed with applicable late fees.
6.3. Analysis and Findings.
6.3.1. Mr. Rohit Vora has accepted the delay in submission of relationship and cost disclosure forms. Hence the DC finds him in contravention of section 208(2)(a) & (e) of the Code, regulation 34A of the CIRP Regulations and regulation 7(2)(h) of IP Regulations read with clause 8C, 13, 19 and 25A of the Code of Conduct also read with circular No. IP/005/2018 dated 16.01.2018 and Circular No. IBBI/IP/013/2018 dated 12.06.2018.
Contravention – V
7.1. Non-submission of CIRP Form with the Board
7.1.1. Regulation 40B of CIRP Regulations requires an IP to file the forms along with the enclosures thereto on an electronic platform of the Board, as per the timelines stipulated. IBBI Circular No. IBBI/CIRP/023/2019 dated 14.08. 2019 on ‘Filing of Forms for the purpose of monitoring corporate insolvency resolution processes and performance of insolvency professionals under the Insolvency and Bankruptcy Code, 2016 and the regulations made thereunder’, mandated that, an IP shall file electronically the Forms along with relevant information and records, in respect of all CIRPs, both closed and ongoing, conducted by him and the Forms along with relevant information and records by the timelines as specified.
7.1.2. It is observed that CIRP Forms 4, 5, 6 and 8 have not been submitted to the Board as per Regulation 40B of the CIRP Regulations.
7.1.3. In view of the above, the Board held the prima facie view that Mr. Rohit Vora has inter alia violated section 208(2)(e) of the Code, regulation 40B of the CIRP Regulations and regulation 7(2)(a) & (h) of IP Regulations read with clauses 15 and 19 of the Code of Conduct also read with Circular No. IBBI/CIRP/023/2019 dated 14.08.2019.
7.2. Submissions made by Mr. Vora.
7.2.1. Mr. Rohit Vora submitted that on 01.03.2023 he received email from the Board asking for closure of assignment Form. He submitted that he could not fill up the relevant details due to real time actual complex data behaviour of CD and in regular consultation with the Board and his Team could close the data.
7.2.2. Mr. Rohit Vora submitted that the CIRP Cost is inclusive of RP and RP team fees, RP and RP team cost and expenses, security cost, all such cost is yet on. As such all relevant forms to IPA & IBBI are yet undetermined and hence not in the position to appropriately filled in other wise like other returns of IPA and IBBI he could have certainly submitted or filled in.
Analysis and Findings
7.2.3. The relevant forms required to be filed under regulation 40B of the CIRP Regulations are as follows:
|Period covered and scope||Timeline|
|CIRP 4||From Issue of IM till issue of RFRP: This includes expression of interest; RFRP and modification thereof;
evaluation matrix and modification thereof; non- compliances with the provisions of the Code and other laws applicable to the CD; etc.
|Within seven days of the issue of RFRP under regulation 36B.|
|CIRP 5||From Issue of RFRP till completion of CIRP: This includes updated list of claimants; updated CoC; details of the resolution applicants; details of resolution plans received; details of approval or rejection of resolution plans by CoC; application filed with AA for approval of resolution plan; details of resolution plan approved by the AA; initiation of liquidation, if applicable; expenses incurred on or by RP; appointment of professionals and the terms of appointment; relationship of the RP with the CD, Financial Creditors, and Professionals; support services taken from IPE; non-compliances with the provisions of the Code and other laws applicable to the CD; etc.||Within seven days of the approval or rejection of the resolution plan under section 31 or issue of liquidation order under
section 33, as the case may be, by the
|CIRP 6||Event Specific: This includes:
a. Filing of application in respect of preferential transaction, undervalued transaction, fraudulent transaction, and extortionate transaction;
b. Raising interim finance;
c. Commencement of insolvency resolution process of guarantors of the CD;
d. Extension of period of CIRP and exclusion of time;
e. Premature closure of CIRP (appeal, settlement, withdrawal, etc.);
f. Request for liquidation before completion of CIRP; and
g. Non implementation of resolution plan, as approved by the AA.
|Within seven days of the
occurrence of the relevant
(1B) The resolution professional shall file Form CIRP 8 intimating details of his opinion and determination under regulation 35A, on or before the one hundred and fortieth day of the insolvency commencement date:
7.2.4. From the available records it appears that no Form G or Expression of Interest was issued during the CIRP of CD. Hence, the need to file CIRP 4 could not have arisen. Regarding CIRP 5 and 6, the above provisions require an IRP/RP to file either of them on occasion of liquidation of CD. The same has not been done by Mr. Rohit Vora. The CIRP 8 pertains to intimation of opinion of an RP regarding avoidance transaction which has not been done by Mr. Rohit Vora. Hence, the DC finds him in contravention of section 208(2)(e) of the Code, regulation 40B of the CIRP Regulations and regulation 7(2)(a) & (h) of IP Regulations read with clauses 15 and 19 of the Code of Conduct also read with Circular No. IBBI/CIRP/023/2019 dated 14.08.2019.
8.1. The DC notes that on several counts, contraventions have been established. Some of the violations as observed by AA are under challenge. Even leving the sub judice matters aside, Mr. Rohit Vora has been found erring in many other aspects which are not covered under the order of the AA. Not responding to Investigating Authority, is akin to undermining the authority of the Board and is blatant violation of the regulation 8(4) and 8(8) of Inspection and Investigation Regulations, regulation 7(2)(h) of the IP Regulations read with clauses 18 and 19 of the Code of Conduct. On this count itself, a message is required to be sent to the regulated professionals that communication from the Board cannot be taken lightly.
8.2. In view of the submission made by Mr. Rohit Vora, and materials available on record, DC notes that Mr. Rohit Vora has contravened provisions of the Code and Regulations framed thereunder in the form of not extending co-operation to IA, not filing of relationship disclosures and not filing of necessary compliance forms. The DC, in exercise of the powers conferred under section 220(2) of the Code read with IBBI (Insolvency Professionals) Regulations, 2016 and the IBBI (Inspection and Investigation) Regulations, 2017, hereby, suspends the registration of Mr. Rohit Vora for one year.
8.3. This Order shall come into force after 30 days from the date of this order.
8.4. The DC also takes note of non-cooperation on part of the CoC member, the Religare Finvest Ltd. Time bound resolution is closely knit with the value maximization maxim of the Code. Taking months in effectuating the replacement of RP has virtually derailed the whole process. This order may be brought to the notice of higher authorities of the Bank for taking suitable action against erring official as they may deem fit.
8.5. A copy of this order shall be sent to the CoC of all the Corporate Debtors in which Mr. Rohit Vora is providing his services, if any.
8.6. A copy of this order shall be forwarded to the Insolvency Professional Agency of Institute of Cost Accountants of India where Mr. Rohit Vora is enrolled as a member.
8.7. A copy of this order shall also be forwarded to the Registrar of the Principal Bench of the National Company Law Tribunal, New Delhi, for information.
8.8. Accordingly, the show cause notice is disposed of.
Whole Time Member, IBBI
Date: 3rd July, 2023
Place: New Delhi