Case Law Details
Jayesh N. Sanghrajka Vs The Monitoring Agency nominated by the Committee of Creditors of Ariisto Developers Pvt. Ltd. (NCLAT Delhi)
Appellant claiming that he had done excessively well to deserve Rs. 3 Crores of success fees, the Adjudicating Authority had made comments as to what was the scenario when it was supervising the CIRP. We have seen the observations of the Adjudicating Authority in impugned para 23 of the impugned order. The Adjudicating Authority was at the ground level monitoring the progress of CIRP and its observations cannot be simply ignored.
For the above reasons, we hold that ‘success fees’ which is more in the nature of contingency and speculative is not part of the provisions of the IBC and the Regulations and the same is not chargeable. Apart from this, even if it is to be said that it is chargeable, we find that in the present matter, the manner in which, it was last minute pushed at the time of approval of the Resolution Plan and the quantum are both improper and incorrect.
The argument that the Adjudicating Authority should have sent the matter back to the CoC if it was not approving the success fee deserves to be discarded as the Adjudicating Authority while not accepting the success fee merely asked proportionate distribution which would even otherwise have happened if “success fee” was set aside as the money would become available improving percentage of other creditors’ dues.
For such reasons, we do not find that there is any substance in the Appeal. The Appeal is dismissed. No order as to costs.
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