Mohd Sharief Tariq, Member - (1.) Under consideration is an Application No.47/2017 filed in CP/531/IB/2017. The Application has been filed by the suspended Director/Shareholder of the Corporate Debtor viz. Mr. K. Paramasivarn^ praying therein to strike off the Resolution passed under item No.5 in the 1st Committee of Creditors (CoC) held on 07.09.2017 and also to strike off the Resolution passed under item No.5 of the Minutes of 2nd CoC held on 25.09.2017. Heard Ld. Counsel for the Applicant, IRP and his Counsel and perused the record.
(2.) It has been submitted by the Ld. Counsel for the Applicant that the Resolution Professional (RP) has no powers to conduct the 'forensic audit' pertaining to the books of accounts of the Corporate Debtor and the same is beyond his jurisdiction. Further, it has been stated that without the specific or general powers under the I&B Code, 2016 and Regulations made thereunder, the action of the RP is illegal. Therefore, the Resolutions passed under item Nos.5 in 1st CoC held on 7.9.2017 and 2nd CoC held on 25.09.2017 are required to be struck off. The Resolutions in question read as follows :- "Resolved to appoint a Forensic Auditor to carry out Forensic audit of the accounts of the Company for the 2/ years period preceding the insolvency commencement date as stipulated u/s. 46 (1) (ii) of the IBC- 2016". In this context for action by RP the FC, SBI provided to the RP draft of their following resolutions for passing. "The Resolution Professional is informed that the bank conducted a Stock Audit by M/s. S. Radha & Co., Chartered Accountants, report dated 01.11.2016. Numerous irregularities have been reported in the report, including diversion of money to related parties. There appears to be lot of scope for attempted fraudulent conduct of business by the Corporate Debtor with intent to defraud the Bank. It is resolved to request the Resolution Professional to examine invocation of Sec. 66(1) of the IBC, 2016 against the Corporate Debtor and initiate necessary punitive action." Since the FC, the SBI, holds 100% of the voting rights, the above resolution is treated as passed.
(3.) The Ld. Counsel for RP has submitted that it is required to conduct the said audit in order to find out the relevant information as to whether the affairs of the Corporate Debtor has been conducted in a manner due to which the property of the Corporate Debtor is diverted or any fraud has been committed, and the same falls within the purview of the powers given to the RP, under the provisions of Section 66(1) of the I&B Code, 2016./;