Corporate Debtor Liquidation Order Issued under Insolvency Code Section 33

The Adjudicating Authority ordered the liquidation of the Corporate Debtor, M/s. GB Engineering Enterprises Private Limited, under Section 33 of the Insolvency and Bankruptcy Code, 2016. Despite efforts to secure a Resolution Plan, none was forthcoming due to minimal operations, high fixed expenses, lack of cooperation, and mounting liabilities. The Committee of Creditors supported the decision, leading to the appointment of the Resolution Professional as the Liquidator. The order detailed the transfer of powers, duties, and compliance requirements for the liquidation process.

---

---

Issues:
Liquidation of Corporate Debtor under Section 33(1)(a) of the Insolvency and Bankruptcy Code, 2016.

Analysis:
The case involved a Miscellaneous Application filed by the Resolution Professional seeking an order for the liquidation of the Corporate Debtor under Section 33(1)(a) of the Insolvency and Bankruptcy Code, 2016. The application was based on the fact that no Resolution Plan had been received by the Adjudicating Authority within the stipulated time frame. The Corporate Debtor, M/s. GB Engineering Enterprises Private Limited, had initiated Corporate Insolvency Resolution Process (CIRP) under Section 10 of the I&B Code, 2016, which led to the appointment of an Interim Resolution Professional. Subsequently, the Resolution Professional was appointed by the Adjudicating Authority. Despite efforts to elicit interest through an 'Expression of Interest' process, no Resolution Plan was submitted by any applicant, leading to the decision for liquidation.

The Resolution Professional highlighted that the Corporate Debtor had minimal operations with high fixed overhead expenses that could not be sustained by the revenue generated. The operations were running at less than 1% of production capacity, with most existing orders completed. Additionally, a lack of cooperation from workers and management, along with mounting liabilities, further contributed to the decision for liquidation. The Committee of Creditors (CoCs) unanimously agreed that there was no viable Resolution Plan and passed a resolution to file for liquidation, appointing the Resolution Professional as the Liquidator.

The Adjudicating Authority, after reviewing the facts presented in the application, proceeded to order the liquidation of the Corporate Debtor in accordance with Section 33 of the I&B Code, 2016. The order outlined the appointment of the Company Liquidator, cessation of the moratorium, transfer of powers to the Liquidator, and the conduct of liquidation proceedings as per the regulations. It also specified the duties and responsibilities of the Liquidator, including the right to charge fees for managing the liquidation estate. The order directed the Registry to notify relevant entities about the liquidation process and compliance requirements.

In conclusion, the Miscellaneous Application filed by the Resolution Professional for the initiation of liquidation proceedings against the Corporate Debtor was disposed of, and the order for liquidation was pronounced in open court, detailing the necessary steps to be taken in the liquidation process.

---