ALOK KAUSHIK versus MRS BHUVANESHWARI RAMANATHAN AND OTHERS

Citation: [2021] 4 S.C.R. 521 · Decided: 15-03-2021 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Appeal(s) allowed

Judgment (excerpt)

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ALOK KAUSHIK
v.
MRS BHUVANESHWARI RAMANATHAN AND OTHERS
(Civil Appeal No. 4065 of 2020)
MARCH 15, 2021
[DR. DHANANJAYA Y CHANDRACHUD AND
M. R. SHAH, JJ.]
Insolvency and Bankruptcy Code, 2016: s.60(5)(c) – Dispute
regarding fee of valuer – Pursuant to the initiation of CIRP against
corporate debtor, first respondent was appointed as the Resolution
Professional (RP) – RP appointed appellant as a registered valuer
of the Plant and Machinery of the corporate debtor of 115 sites
and a fee of Rs.7.50 lakhs and other expenses were ratified by the
Committee of Creditor (CoC) – Appellant claims to have conducted
valuation work of 84 sites and he paid for expenses of Rs.52,000 –
NCLAT set aside the CIRP against the corporate debtor and
remanded the matter to NCLT on the issue of CIRP costs – NCLT
decided on the fee of RP and reduced it by 20% from the fee ratified
by CoC – In view of order of NCLAT, RP cancelled the appointment
of the appellant and requested appellant for waiver of fee – In
return, appellant agreed to reduce his fee by 25% along with the
expenses – However, RP informed appellant that the fee as ratified
cannot be paid and paid a sum of Rs.50,000 – Appellant filed
application under s.60(5) before the NCLT challenging non payment
of fees – However, the NCLT dismissed the application on the ground
that it had been rendered functus officio – NCLAT declined to exercise
its appellate jurisdiction – Hence the instant appeal – Held: Though
the CIRP was set aside later, the claim of the appellant related to
the period when he was discharging his functions as a registered
valuer appointed as an incident of the CIRP – NCLT ought to have
exercised its jurisdiction under s.60(5)(c) of the IBC – In exercise
of jurisdiction under Art.142 of the Constitution, it is directed that
in a situation such as the present case, NCLT is sufficiently
empowered under s.60(5)(c) of the IBC to make a determination of
the amount which is payable to an expert valuer as an intrinsic part
of the CIRP costs – Regn.34 of the IRP Regulations defines
‘insolvency resolution process cost’ to include the fees of other
   [2021] 4 S.C.R. 521
521
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SUPREME COURT REPORTS
[2021] 4 S.C.R.
professionals appointed by the RP – Whether any work has been
done as claimed and if so, the nature of the work done by the valuer
is something which need not detain this Court, since it is purely a
factual matter to be assessed by NCLT – The availability of a
grievance redressal mechanism under the IBC against an insolvency
professional does not divest the NCLT of its jurisdiction under
s.60(5)(c) of the IBC to consider the amount payable to the appellant
– In any event, the purpose of such a grievance redressal mechanism
is to penalize errant conduct of the RP and not to determine the
claims of other professionals which form part of the CIRP costs –
The impugned judgment and order of the NCLAT is set aside – The
proceedings accordingly is remitted back to the NCLT for
determining the claim of the appellant for the payment of the
professional charges as a registered valuer appointed by the RP in
pursuance of the initiation of the CIRP.
Allowing the appeal and remitting the matter to NCLT,
the Court
HELD : 1.1  Where an application for withdrawal is filed
under Section 12A of the IBC, a provision has been made in
Regulation 30A(7) in regard to the deposit of expenses.
Regulation 30(A) would not apply specifically to the present
situation, since it deals with a case where an application is
withdrawn under Section 12A of the IBC. The appellant is justified
in contending that there must be a forum within the ambit and
purview of the IBC which has the jurisdiction to make a
determination on a claim of the present nature, which has been
instituted by a valuer who was appointed in pursuance of the
initiation of the CIRP by the RP. After the NCLAT set aside the
CIRP and remitted the proceedings to the NCLT to decide on
the CIRP costs, the NCLT held that it was rendered functus officio
in relation to the appellant’s claim. This would be an incorrect
reading of the jurisdiction of the NCLT as an Adjudicating
Authority under the IBC. [Paras 16, 18][528-G-H; 529-F-H]
1.2 Though the CIRP was set aside later, the claim of the
appellant as registered valuer related to the period when he was
discharging his functions as a registered valuer appointed as an
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incident of the CIRP. The NCLT would have been justified in
exercising its

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