# In the matter of JSM Devcons India Pvt. Ltd. TP 230 of 2019

> NCLT judgment dated 2023-03-24. Citation: TCN-2023-NCLT-04066. The case involves Daimler Financial Services Pvt Ltd as the applicant and JSM Devcons India Pvt…

- **Court:** NCLT
- **Order date:** 24 Mar 2023
- **Citation:** TCN-2023-NCLT-04066
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/jsm-devcons-india-pvt-ltd-tp-230-of-2019-a6fd8be4

## Summary

### Background

The case involves Daimler Financial Services Pvt Ltd as the applicant and JSM Devcons India Pvt Ltd as the respondent. The proceedings are under Section 7 of the IBC. The Resolution Professional (RP) has not appeared despite a previous order dated 19.01.2023, which the Adjudicating Authority finds appalling. The CoC is at liberty to pass a resolution regarding the replacement of the RP. The court notes the peculiarity of the situation where the IP suggested by the CoC could be appointed as RP but is not discharging his function and is also not represented before the Adjudicating Authority. Counsel for the Financial Creditors (AR) alleges that the RP is absconding and has embezzled the EMD submitted by the Proposed Resolution Applicant.

## Facts

Daimler Financial Services Pvt Ltd initiated proceedings against JSM Devcons India Pvt Ltd under Section 7 of the IBC. The Resolution Professional (RP) failed to appear before the Adjudicating Authority despite a prior order dated 19.01.2023. The counsel for the Financial Creditors (AR) alleged that the RP is absconding and has embezzled the Earnest Money Deposit (EMD) submitted by the Proposed Resolution Applicant. The CoC has the liberty to replace the RP. The court is considering referring the matter to the IBBI for further action due to the RP's absence and the allegations against him. The case involves multiple Interlocutory Applications (IAs).

## Issues and analysis

### Issue 1: Whether the failure of the Resolution Professional (RP) to appear before the Adjudicating Authority …

**Ratio:** The Adjudicating Authority has the power to ensure the proper conduct of the Corporate

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**Reasoning:** The court notes the RP's absence despite a prior order and the seriousness of the

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**Interpretation:** The interpretation is that the Adjudicating Authority has supervisory powers

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**Application:** The RP's failure to appear is a significant breach of his duties, justifying

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## Parties

- **Judges:** Sh. Ashok Kumar…; Ajai Das Me…
- **Appellants:** Daimler Financial…
- **Respondents:** JSM Devcons India…

## Timeline

- **2023-01-19 — Previous…**: Adjudicating Authority passed an…
- **2023-03-24 — Current…**: Order delivered referring the matter to…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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