Court Orders Liquidation of Corporate Debtor after Failed Resolution Plan

The court admitted the application for Corporate Insolvency Resolution Process under Section 7 of the Insolvency and Bankruptcy Code, 2016, appointed an Interim Resolution Professional (IRP), and later confirmed the Resolution Professional (RP). Despite efforts, no resolution plan was approved due to asset attachment, leading to the CIRP period expiring. RP's appeals for asset release and exclusion of CIRP period were dismissed. With no approved plan, liquidation was ordered under Section 33 of the Code, appointing RP as Liquidator to sell the Corporate Debtor. An additional judgment dismissed RP's request to exclude CIRP period due to pending litigation.

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Issues:
1. Initiation of Corporate Insolvency Resolution Process under Section 7 of I & B Code, 2016.
2. Failure to approve resolution plan due to attachment of assets.
3. Expiry of CIRP period without resolution plan approval.
4. Dismissal of RP's appeal for releasing attachment of assets.
5. RP's request for exclusion of CIRP period due to pending litigation.
6. RP's appeal for excluding CIRP period dismissed.
7. Order for liquidation of Corporate Debtor.

Analysis:
1. The application was filed by the Financial Creditor to initiate Corporate Insolvency Resolution Process against the Corporate Debtor under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Bench admitted the application, appointed an Interim Resolution Professional (IRP), and later confirmed the appointment of Resolution Professional (RP) after the CoC's approval.

2. The RP filed a final progress report stating that no resolution plan was approved due to the attachment of assets of the Corporate Debtor. Despite efforts to de-attach assets, no resolution applicant showed interest, leading to the expiry of the CIRP period.

3. The CIRP period ended without the approval of any resolution plan, even after multiple CoC meetings and discussions with prospective resolution applicants. The RP's request for exclusion of unutilized time due to pending litigation was dismissed.

4. RP's appeal for releasing attachment of assets was dismissed, leading to uncertainty in the resolution process. The Bench refrained from passing a liquidation order due to the pending appeal, despite RP's failure to submit a resolution plan within the stipulated time.

5. RP sought exclusion of CIRP period due to pending litigation, but the Bench found no justification for further adjournment. RP's expectation of a favorable order from the Appellate Authority under PMLA was deemed insufficient to delay the proceedings.

6. The Bench, after considering RP's submissions and CoC's failure to approve any resolution plan, deemed it necessary to pass an order for liquidation under Section 33 of the I & B Code, 2016. RP's readiness to continue as the Liquidator was noted.

7. The Liquidator was appointed to sell the Corporate Debtor as a going concern and initiate the liquidation process as per the Code and regulations. The order for liquidation was issued with detailed directions regarding public announcements, moratorium, employee discharge, and reporting requirements.

Additional Judgment:
An application by the RP to exclude the CIRP period due to pending litigation was dismissed. The Bench found no valid reason to exclude the period solely based on the appeal before the Appellate Authority of PMLA. The application was rejected, and the appeal was disposed of without costs.

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