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Issues: (i) Whether, after expiry of the CIRP period and absence of a resolution plan, the pending interlocutory applications survived for adjudication. (ii) Whether the West Bengal Protection of Interest of Depositors in Financial Establishments Act, 2013 applied so as to bar the insolvency process or the reliefs sought in relation to properties under attachment. (iii) Whether the corporate debtor was liable to be taken into liquidation under section 33(1) of the Insolvency and Bankruptcy Code, 2016.
Issue (i): Whether, after expiry of the CIRP period and absence of a resolution plan, the pending interlocutory applications survived for adjudication.
Analysis: The CIRP period had expired, no resolution plan had emerged, and the matter had moved to the stage where liquidation was required. The reliefs sought in the connected applications, including claims relating to assets, attachment, possession, and demarcation, had therefore become incapable of effective adjudication within the resolution phase and were treated as no longer requiring consideration at that stage.
Conclusion: The pending interlocutory applications did not survive for substantive adjudication and were rendered infructuous at the CIRP stage.
Issue (ii): Whether the West Bengal Protection of Interest of Depositors in Financial Establishments Act, 2013 applied so as to bar the insolvency process or the reliefs sought in relation to properties under attachment.
Analysis: The corporate debtor was found not to be a financial establishment within the meaning of section 2(e) of the West Bengal Protection of Interest of Depositors in Financial Establishments Act, 2013, and no material was produced to show that the insolvency proceedings were illegal on that account. At the same time, where properties were under attachment by the authorities under that Act, the Tribunal held that the Act had its own remedial framework, including an appeal mechanism under section 19, and the title or release issues concerning such attached property could not be decided in the insolvency proceedings.
Conclusion: The West Bengal Protection of Interest of Depositors in Financial Establishments Act, 2013 did not displace the insolvency proceedings, but the Tribunal declined to determine title or order de-attachment in respect of property under attachment.
Issue (iii): Whether the corporate debtor was liable to be taken into liquidation under section 33(1) of the Insolvency and Bankruptcy Code, 2016.
Analysis: The Committee of Creditors had approved liquidation by majority, the resolution process had failed, and the Resolution Professional's inability to secure assets and complete the process was attributed to non-cooperation from the authorities concerned. In these circumstances, the statutory conditions for liquidation were satisfied, and the Liquidator was to be appointed to proceed under the liquidation framework.
Conclusion: The corporate debtor was ordered to be liquidated, and the Resolution Professional was appointed as Liquidator.
Final Conclusion: The insolvency proceedings culminated in liquidation of the corporate debtor, while the connected applications were either rendered infructuous or dismissed, including dismissal of one application with costs.
Ratio Decidendi: Where the CIRP fails and the Committee of Creditors resolves to liquidate, the Tribunal may order liquidation under section 33(1) of the Insolvency and Bankruptcy Code, 2016; claims of a separate attachment statute do not, by themselves, nullify the insolvency process, and disputes over attached property must be pursued in the forum provided by that special statute.
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