Tribunal Orders Liquidation due to Lack of Resolution Plan, Emphasizes Timely Progress

The Tribunal rejected the application to exclude 60 days in the Resolution Process, emphasizing the need for substantial progress within the stipulated timeline. With no Resolution Plan forthcoming, the Corporate Debtor was ordered into liquidation. The Tribunal directed the appointment of a Liquidator, stressing compliance with the Insolvency and Bankruptcy Code provisions.

---

---

Issues involved:
1. Application filed seeking to exclude period of 60 days in Resolution Process.
2. Status of assets and liabilities of the Corporate Debtor.
3. Time lost in legal proceedings with Government of Karnataka.
4. Extension of CIRP completion date.
5. Decision on passing order of liquidation and appointment of Liquidator.

Issue 1 - Application seeking to exclude 60 days in Resolution Process:
The Resolution Professional filed an application to exclude 60 days due to legal proceedings, seeking an extension of the CIRP completion date. The application was based on the need to meet ends of justice and equity for Home Buyers. The application was supported by the 3rd Meeting of CoC, which voted in favor of the extension.

Issue 2 - Status of assets and liabilities of the Corporate Debtor:
The estimated value of properties, financial claims, advances paid to landowners, and total assets and liabilities were detailed. The Resolution Professional highlighted ongoing efforts, follow-ups, and expected claims from Homebuyers and other legislation. The Resolution Professional expressed confidence in completing the work and inviting Expression of Interest for a Resolution Plan.

Issue 3 - Time lost in legal proceedings with Government of Karnataka:
Significant time was lost in legal proceedings with the Government of Karnataka, impacting the CIRP timeline. The rejection of the Applicant's request by the Government based on the KPID Act was highlighted. The time lost from notices to replies was detailed, leading to an extension request for the CIRP completion date.

Issue 4 - Extension of CIRP completion date:
The Tribunal reviewed the application, pleadings, and relevant provisions of the Code. It noted the lack of substantial progress in the CIRP process despite the permissible time limit being close to expiration. The Tribunal found the application baseless and rejected it, emphasizing the need for substantial work within the stipulated timeline.

Issue 5 - Decision on passing order of liquidation and appointment of Liquidator:
In light of the lack of a Resolution Plan within the stipulated period and the rejection of the extension request, the Tribunal directed the Corporate Debtor to be placed under liquidation. It further instructed the COC and AR to suggest a qualified Liquidator for appointment, emphasizing the necessity of this step in the absence of a Resolution Plan.

In conclusion, the Tribunal rejected the application for an extension, highlighting the need for substantial progress in the CIRP process and the impending liquidation of the Corporate Debtor due to the absence of a Resolution Plan. The decision underscored the importance of timely actions and compliance with the provisions of the Insolvency and Bankruptcy Code.

---