Value Infratech case: NCLAT asks IBBI to probe conduct of resolution professional

Counsel, on behalf of the homebuyers, argued that the Capri Global Capital had sanctioned a loan of Rs 37.50 crore to the corporate debtor and its two sister companies vide a common loan agreement.

The direction came in a matter in which homebuyers filed an application with the appellate tribunal, challenging the January 4 liquidation order of the National Company Law Tribunal (NCLT) for the city-based Value Infratech.

The National Company Law Appellate Tribunal (NCLAT) on Monday asked the Insolvency and Bankruptcy Board of India (IBBI) to investigate the conduct of one resolution professional, Sanjay Kumar Singh, and to take appropriate action against him.

The direction came in a matter in which homebuyers filed an application with the appellate tribunal, challenging the January 4 liquidation order of the National Company Law Tribunal (NCLT) for the city-based Value Infratech.

In their submission, homebuyers of the Skywalk RNE project alleged that the resolution professional had shown undue advantage to the Capri Global Capital, a financial creditor, by adding up all loans provided to the developer and its two sister companies, thereby giving advantage of inflated vote share (96.77%) in the committee of creditors of the corporate debtor.

Counsel, on behalf of the homebuyers, argued that the Capri Global Capital had sanctioned a loan of Rs 37.50 crore to the corporate debtor and its two sister companies vide a common loan agreement.

He argued that in the present matter where the insolvency resolution of Value Infratech India was under consideration, the claim of Capri Global should have been based on the loan disbursed only to Value Infratech.

The counsel stated that the loan disbursed by Capri Global to Value Infratech was only Rs 6.65 crore, while the remaining was for the two sister companies and prayed for setting aside the January 4 impugned order of the NCLT and replace the RP with “any other RP who will act without conflict of interest and in a fair manner”.

In its judgment, the NCLAT said, “The action of the RP Sanjay Kumar Singh in this matter cannot be said to have been above board. He can’t be absolved of certain actions of omission and commission, which have caused prejudice to homebuyers. He should, therefore, be replaced with immediate effect and a suitable RP be appointed in the CIRP of Respondent No 1 (Value Infratech) by the Adjudicating Authority”.

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