Liquidator must first pursue compromise or arrangement before asset sale; liquidation remains a last-resort measure.

In liquidation proceedings, the liquidator must first explore a compromise or arrangement under section 230 of the Companies Act, 2013 before proceeding to sell the corporate debtor's assets. The insolvency framework is treated as revival-oriented, with liquidation as a last resort. Only if revival efforts fail may the liquidator move to sale, including sale of the business as a going concern, while ensuring verification and proper handling of claims and assets in accordance with the Insolvency and Bankruptcy Code, 2016.

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Issues: Whether, in liquidation proceedings, the liquidator is required to first explore a compromise or arrangement under section 230 of the Companies Act, 2013 before proceeding to sell the assets of the corporate debtor.

Analysis: The order proceeds on the basis that the insolvency framework is meant to promote revival and continuation of the corporate debtor, with liquidation as a last resort. Relying on the statutory scheme governing the liquidator's duties and the power to compromise or arrange with creditors and members, the order directs that the liquidator must first act under section 230 of the Companies Act, 2013. Only if revival efforts fail may the liquidator move to sale, including sale of the business as a going concern, while ensuring verification and handling of claims and assets in accordance with the Insolvency and Bankruptcy Code, 2016.

Conclusion: The liquidator was directed to initiate proceedings under section 230 of the Companies Act, 2013 and to proceed to outright sale only upon failure of revival efforts.

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