# In the matter of Midfield Industries Limited IA No. 608 & 649-2021 in CP(IB) No. 562-9-HDB-2019

> NCLT judgment dated 2021-11-12. Citation: TCN-2021-NCLT-00513. The case involves M/s Midfield Industries Limited, which is undergoing the Corporate Insolvency…

- **Court:** NCLT
- **Order date:** 12 Nov 2021
- **Citation:** TCN-2021-NCLT-00513
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/midfield-industries-limited-ia-no-608-649-2021-in-cpib-no-562-9-hdb-2019-37385a50

## Summary

### Background

The case involves M/s Midfield Industries Limited, which is undergoing the Corporate Insolvency Resolution Process (CIRP). IA 608/2021 was filed by the Committee of Creditors (CoC) seeking to replace the Interim Resolution Professional (IRP), Ms. Sandhya Tadla, with Mr. Madasa Kumar. IA 649/2021 was filed by the IRP seeking payment of fees and expenses from the CoC. The CoC had not fully complied with the Adjudicating Authority's direction to reimburse the IRP's costs.

## Facts

M/s Midfield Industries Limited is undergoing CIRP. The Committee of Creditors (CoC) filed IA 608/2021 seeking to replace the Interim Resolution Professional (IRP), Ms. Sandhya Tadla, with Mr. Madasa Kumar. The CoC approved the resolution with 74% voting shares. IA 649/2021 was filed by Ms. Sandhya Tadla, the IRP, seeking payment of her fees and expenses. The Adjudicating Authority had previously directed the CoC to reimburse the IRP's costs, but the CoC had not fully complied. The State Bank of India (SBI), holding 70% stake in CoC, remitted their share to IRP, and Axis Bank, holding 24% stake, approved the payment. Mr. Nitin, Proprietor, Loha Udyog, the Original Operational Creditor, did not obey the directions of the Hon'ble Tribunal vide its order No.562/9/HDB/2019

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## Issues and analysis

### Issue 1: Whether the appointment of Mr. Madasa Kumar as Resolution Professional in place of Ms. Sandhya …

**Ratio:** Section 22 of the Insolvency and Bankruptcy Code, 2016, allows the Committee of Creditors

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**Reasoning:** The CoC passed a resolution with 74% voting shares to appoint Mr. Madasa Kumar as the

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**Interpretation:** Section 22 grants the CoC the power to appoint and replace Resolution

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**Application:** In this case, the CoC's resolution was supported by 74% of the voting shares,

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## Parties

- **Judges:** DR.VENKATA…; BINOD KUMAR…
- **Appellants:** Committee of…
- **Respondents:** Midfield Industrie…; M/s Midfield…

## Timeline

- **2021-11-12 — Order Da…**: Order pronounced by the National Company Law Tribunal, Hyderabad Bench, in IA 608/2021…
- **2021-10-11 — CoC Meet…**: Minutes of the 3rd CoC meeting enclosed, showing approval of resolution to appoint Mr.…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 22 — Appointment of resolution professional](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-22)

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