# In the matter of MLP Developers & Promoters Pvt. Ltd.

> NCLT judgment dated 2023-07-05. Citation: TCN-2023-NCLT-02674. The case involves an application (IA No. 359/2020) filed by the Resolution Professional (RP) of…

- **Court:** NCLT
- **Order date:** 5 Jul 2023
- **Citation:** TCN-2023-NCLT-02674
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/mlp-developers-promoters-pvt-ltd-0d0123db

## Summary

### Background

The case involves an application (IA No. 359/2020) filed by the Resolution Professional (RP) of MLP Developers and Promoters Pvt. Ltd., the corporate debtor, under Section 19(2) of the Insolvency and Bankruptcy Code (IBC), 2016. The RP sought directions from the NCLT to compel the directors and statutory auditors of the corporate debtor to cooperate and provide necessary information and documentation to facilitate the Corporate Insolvency Resolution Process (CIRP). The CIRP was initiated on 27.01.2020, and a moratorium was imposed.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against MLP Developers and Promoters Pvt. Ltd. on 27.01.2020. Mr. Romesh Sawhney was appointed as the Resolution Professional (RP). After a public announcement, the RP received two claims from Sarthak Gupta and Dolly Gupta, the financial creditors. The RP visited the corporate debtor's office and bank but was unable to obtain necessary information or documents. The RP sent numerous emails and letters requesting information, including business operations details, financial statements, asset lists, and creditor advances. The corporate debtor provided limited and incomplete information in response. The RP found discrepancies in the bank statements and tally data provided by the corporate debtor. The RP

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## Issues and analysis

### Issue 1: Whether the directors and statutory auditors of the corporate debtor are obligated to provide the …

**Ratio:** Section 19(2) of the Insolvency and Bankruptcy Code (IBC), 2016, read with Section 18,

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**Reasoning:** The NCLT observed that the RP had requisitioned specific accounting statements that had

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**Interpretation:** The IBC imposes a duty on the directors and statutory auditors to assist the RP

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**Application:** The NCLT applied the provisions of Section 19(2) of the IBC to the facts of the

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## Parties

- **Judges:** Harnam Singh…; SUBRATA KUM…
- **Appellants:** Sarthak…
- **Respondents:** MLP Developers…

## Timeline

- **2020-01-27 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) was initiated against MLP Developers and…
- **2020-02-09 — Claims Re…**: Resolution Professional (RP) received 2 claims from Mr. Sarthak Gupta and Ms. Dolly…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 19(2) — Personnel to extend co-operation to interim…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-19)

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