In the matter of Mr. Kamalesh Kumar Singhania, Insolvency Professional

INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
(Disciplinary Committee)
No. IBBI/DC/42/2020
13th November, 2020
Order

In the matter of Mr. Kamalesh Kumar Singhania, Insolvency Professional (IP) under section 220 of the Insolvency and Bankruptcy Code, 2016 read with regulation 11 of the Insolvency and Bankruptcy Board of India (Insolvency Professional) Regulations, 2016 and regulation 13 of the the Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017.

This Order disposes of the Show Cause Notice (SCN) No. IBBI/IP/MON/2019/39 dated 19th May, 2020 issued to Mr. Kamalesh Kumar Singhania R/o - Bajarang Kunj, Room no. 412 & 413, 2b Grant Lane, 4th Floor, Kolkata, West Bengal-700012 who is a Professional Member of ICSI Institute of Insolvency Professionals and an Insolvency Professional (IP) registered with the Insolvency and Bankruptcy Board of India (IBBI) with Registration No. IBBI/IPA-002/IP-N00023/2016-17/10050.

Background

The Hon’ble NCLT, Kolkata Bench (AA) vide order dated 20th September, 2017 admitted the application under section 7 of the Insolvency and Bankruptcy Code, 2016 (Code) for initiating Corporate Insolvency Resolution Process (CIRP) of M/s Mintri Tea Company Private Limited (CD). In this matter, CoC compised of only Punjab National Bank (PNB). The resolution plan was approved by CoC on 31st May, 2018 and CIRP was completed within 270 days. Later on, PNB filed an application for withdrawal under section 12A before the AA, however, the same was rejected by the AA vide its order dated 03rd August, 2018. This order of AA was set aside by the Hon’ble NCLAT vide order dated 27th February, 2019 wherein the application filed by the PNB for withdrawal of application under section 7 of the Code was allowed and the CD was restored to its old position.

1.1. The IBBI had issued the SCN to Mr. Kamalesh Kumar Singhania on19th May, 2020 based on material available on record including Inspection Report dated 7th December, 2019 in respect of his role as a Resolution Professional (RP) in CIRP of M/s Mintri Tea Company Private Limited (CD). The SCN alleged contraventions of section 208(2)(a) and (e) of the Insolvency and Bankruptcy Code, 2016 (Code), Regulation 13 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2017 (CIRP Regulations) and Regulation 7(2)(a) and (h) of the IBBI (Insolvency Professionals) Regulations, 2016 (IP Regulations) and clause 1, 2, 3, 10 and 14 of the Code of Conduct under regulation 7(2) thereof. Mr. Kamalesh Kumar Singhania replied to the SCN vide letter dated 15thJune, 2020.

1.2. The IBBI referred the SCN, response of Mr. Kamalesh Kumar Singhania to the SCN 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. Mr. Kamalesh Kumar Singhania availed an opportunity of virtual personal hearingbefore the DC on 9th September, 2020 wherein he was represented by his counsel, Mr. Pranay Agarwal, Advocate. Mr. Singhania reiterated the submissions made in his written reply and also submitted additional documents via email dated 9th September, 2020 in the matter.

2. Alleged Contraventions and Submissions

Contraventions alleged in the SCN and Mr. Kamalesh Kumar Singhania’s written and oral submissions thereof are summarized as follows.

I Contravention

2.1. CIRP of the M/s Mintri Tea Company Private Limited commenced on 20th September, 2017. Its financial creditor (FC), i.e., the PNB filed a claim in Form ‘C’ dated 3rd October, 2017 for the amount of Rs. 10,37,69,840/- and interest and other charges to be calculated till actual realization. The amount stated was the amount outstanding as on 31st May, 2017. The said claim was admitted by the Mr. Singhania and voting share was given to PNB on the basis of said claim. During CIRP, on 21st April, 2018, PNB filed a revised claim in Form C to the RP. The revision was on account of repayment by guarantors of CD of certain portion of total outstanding amount. PNB submitted the revised claim of Rs. 1,27,74,287.80 (as on 10th April, 2018) which included interest for the period of 20th September 2017 to 10th April, 2018 (i.e. for post CIRP commencement period). This revised claim and revised voting share of PNB was accepted by Mr. Singhania in the meeting of Committee of Creditors and the same was also recorded in the minutes of 7th CoC meetings dated 7th May, 2018.

To know more in details find the attachment file