# In the matter of Diamond Shipping Company Limited

> NCLT judgment dated 2024-05-02. Citation: TCN-2024-NCLT-01478. The application was filed by ICICI Bank Limited against Ms. Sonu Jain, the erstwhile liquidator…

- **Court:** NCLT
- **Order date:** 2 May 2024
- **Citation:** TCN-2024-NCLT-01478
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/diamond-shipping-company-limited-bdca3749

## Summary

### Background

The application was filed by ICICI Bank Limited against Ms. Sonu Jain, the erstwhile liquidator of Diamond Shipping Company Limited, seeking directions for the liquidator to return Rs. 12,76,000 along with 18% interest. The applicant also sought directions for the respondent to handover all information and documents relating to the CIRP and liquidation process to the present liquidator. Diamond Shipping Company Limited was admitted into CIRP on 2019-03-14, and the respondent was appointed as the Insolvency Resolution Professional. Subsequently, the corporate debtor went into liquidation, and the respondent was replaced by Mr. Krishna Kumar Chamaria as liquidator. The replacement was due to allegations of unlawful and wrongful acts by the respondent during her tenure as

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## Facts

Diamond Shipping Company Limited was admitted into CIRP on 2019-03-14. Ms. Sonu Jain was appointed as the Insolvency Resolution Professional and later became the liquidator. Subsequently, she was replaced by Mr. Krishna Kumar Chamaria due to allegations of unlawful and wrongful acts. ICICI Bank Limited, the applicant, filed an application seeking directions for Ms. Jain to return Rs. 12,76,000 along with 18% interest, claiming that she had incurred expenses without proper supporting documentation. Ms. Jain had sold an asset of the corporate debtor for Rs. 12,76,000 during her tenure as liquidator and provided an account of expenditure incurred in connection with the liquidation. The court noted that significant expenses were claimed for public announcements, filing,

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## Issues and analysis

### Issue 1: Whether the erstwhile liquidator, Ms. Sonu Jain, should be directed to return Rs. 12,76,000 along …

**Ratio:** The ratio is based on the principle that expenses incurred during the liquidation process

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**Reasoning:** The court reasoned that the respondent had claimed significant expenses without providing

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**Interpretation:** The interpretation is that liquidators have a fiduciary duty to ensure that all

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**Application:** The court applied this ratio to the facts by directing the respondent to

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## Parties

- **Judges:** BIDISHA BA…; SHRI. D.A…
- **Appellants:** ICICI Bank…
- **Respondents:** Diamond Shipping…; Sonu…

## Timeline

- **2019-03-14 — CIRP Admi…**: Diamond Shipping Company…
- **2021-11-26 — Resignation Ac…**: The Bench accepted the resignation of the respondent as liquidator and fixed the total…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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