The negative approach of the key director made me ready for the non-cooperation that he would play with.
The mall was located in a prime place in the city. Managing the mall was a huge and complicated task.
The employees were confused and afraid of job loss
Various shortcomings in the maintenance of records and compliance with Government Agencies were found. Like non-updates of regular accounting, non-availability of some of the agreements with tenants, and non-compliance with EPFO rules.
As such, the EPFO started demanding old records (for the past 9-10 years) and also started to convey that if the same is not provided, they would take actions under the authority given to them under the rules of EPFO
Lack of security agency interest and therefore working without any deep interest
Similarly, maintenance of the mall was not up to the mark and was leading to the deterioration of its ambiance and the number of revisiting public members. The elevators were not in good/working conditions
Due to the non-availability of records, and agreements, various issues by tenants or some claiming to be allottees of some showrooms came up. Verification was not possible in the absence of updated records from the directors
Also, Nagar Nigam, Bhopal started to issue notices for various matters. To sort out the same was necessary for me to concentrate on the IBC process
Rent collection from some of the tenants was not found –directly affecting the revenue of the company
Actions taken
Firstly, I became aware and made up my mind that my duties will not be simple or limited. I would have to ensure that:
I would have to run the mall and maintain “Going Concern” status.
At the same time, being IP/RP, I have to scrupulously follow the process laid down under the law - within the stipulated time period.
Also considering the prime location, running condition, reputed tenants, etc. I would take such actions that would enhance the reputation in the minds of the visitors and thereby increase the brand value of the mall.
Being in charge of the company/running mall as RP, I would have to comply with statutory norms and various rules of different government bodies like - Income Tax, Service Tax, PPF, SEBI, etc.
To Coordinate the team of employees and generate confidence in them.
To get all records updated
Security management and infrastructure management and maintenance of the mall
continue to follow up with the director and ask him for all missing / updated records
Appointed one C.A. as CEO of the company to become overall in charge of the company, to monitor the daily routine, take care of administration, collect reports, and keep me updated.
Appointed another C.A. to report on related party transactions /fraudulent transactions etc.
Arranged a meeting with departmental heads from the employees and generated confidence among them. Explained to them about the process under IBC and why they should cooperate.
I continued reporting to my authorities like IBBI, and NCLT by way of separate communication or by way of regular reporting formats about the mess-like situation and non-cooperative attitude of the directors leading to delays in the process.
Applied for actions against suspended management for non-cooperation.
Result Achieved
The employees started cooperating with me and my team. Gradually majority of the record could be dug out.
The C.A. appointed by me kept me appraised of all the development and also with his daily reporting, the problems were identified and matters started to be concluded speedily.
With actions taken and brand value improved, could attract some Resolution Applicants. However, with their belief that NPA properties are available at throw-away prices, their plan could not be accepted by CoC.
With the deployment of JLL, the ambiance of the mall could be brought back to its original glory. The visitor's feedback was also encouraging.
All of the above resulted in an increase in the Number of footfalls & number of visitors in the mall per day.
This improvement had a direct positive bearing on the revenue of each leaseholder and also of the mall.
Issues like EPFO, Nagar Nigam, and others got diluted over time with concentrated efforts and the number of meetings with authorities.