In the matter of Canara Bank Vs. Ms. Mamta Binani, RP of Aristo Texcon Pvt. Ltd., reported at (2022) ibclaw.in 01 NCLAT, the Appellate Tribunal(NCLAT) described roles and duties of a Resolution Professional as:
- A Resolution Professional has a duty among other things to invite the prospective Resolution Applicant who satisfies the requirements as prescribed by him with the approval of the Committee of Creditors keeping in mind the complexity and scale of operation of the business of the Corporate Debtor and other conditions as may be prescribed by the IBBI to place forward the Resolution Plans, project such plan to the CoC etc. He is an Officer of the Court and he is to exercise reasonable and responsible care for the company whose property and affairs are entrusted with him. He has an absolute duty to secure the best prize in the given circumstances and he is not made liable because his perception is wrong, of course, with the rider that unless it is not a reasonable one.
- As per Section 25(2)(i) of the Code, a duty is cast on the Resolution Professional to scrutinize the Resolution Plan to ensure that it is in accordance with Section 30 of the Code and CIRP Regulation 37. In case, the Resolution Plan is not meeting the requirement of Section 30 of the Code, the Resolution Professional is empowered to refuse to present the Plan to the CoC.
- A Resolution Professional is only to examine and confirm that each Resolution Plan conforms to what is mentioned by Section 32 of the Code. The Resolution Professional shall undertake to project all the Resolution Plans during the Meetings of the CoC and as per Section 30(3) of the Code the Resolution Professional shall present to the CoC for its approval, such Resolution Plans which confirms the condition mentioned in sub-section (2).
- A Resolution Professional is to scrutinise that the Resolution Plan furnished by numerous applicants is complete in all aspects, before presenting it to the Committee of Creditors. A Resolution Professional is not required to take any decision but he is to confirm that the Resolution Plan does not violate any of the provisions of Law for the time being in force (including Section 29A of Code). Suffice for this Tribunal to pertinently point out that an ex-facie opinion is to be offered to the CoC by the Resolution Professional that the Law was not violated.
- It is the duty of the Resolution Professional to determine as to whether the eligibility criteria of Resolution Applicants prescribed in Section 29-A of the Code are satisfied. He is to consider the objections brought to his notice prior to the submission of the Resolution Plan to the CoC. As per Section 30(2) of the Code, the Resolution Professional is to examine each Resolution Plan received by him to confirm that the Resolution Plan provides for payment of Insolvency Resolution Process Costs, Payment of Debts of the Operational Creditors, management of the affairs of Corporate Debtor, the fulfillment and supervision of Resolution Plan, other requirement as may be specified by the Board and does not violate any of the provisions of the law for the time being in force.
- A Resolution Plan submitted by the concerned Resolution Applicant on accounts of its confidentiality, cannot be disclosed to any competing Resolution Applicant nor any opinion can be taken or objection can be called for from other Resolution Applicants in regard to one other Resolution Plan.
- Subjective satisfaction is a pre-requisite for approval of Resolution Plan. A threadbare scrutiny and a study of the Resolution Plan is to be made prior to the ‘satisfaction’ being arrived at by the Adjudicating Authority in a written form. The Code speaks of accountability of the Insolvency Professional and also the CoC who comprise of the Lender Banks.