Liquidation and revival process requires Section 230 compromise efforts before sale of corporate debtor assets.

Liquidation was not interfered with because the resolution period had expired and no viable resolution plan was available, while recognising that revival remains the objective of insolvency proceedings. The tribunal also stated that, in liquidation, 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. Sale becomes permissible only after revival efforts fail and the company cannot be maintained as a going concern.

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Issues: (i) Whether the order of liquidation required interference. (ii) Whether, in liquidation, the liquidator must first explore a compromise or arrangement under Section 230 before sale of the corporate debtor's assets.

Issue (i): Whether the order of liquidation required interference.

Analysis: The liquidation order was passed after the resolution period had expired and no viable resolution plan was available. The appellate forum declined to interfere, while recognising that liquidation is not the preferred end-state and that revival remains the underlying objective of the insolvency framework.

Conclusion: The liquidation order was not interfered with.

Issue (ii): Whether, in liquidation, the liquidator must first explore a compromise or arrangement under Section 230 before sale of the corporate debtor's assets.

Analysis: The decision treated revival and continuation of the corporate debtor as the primary objective even during liquidation. It relied on the principle that liquidation is a last resort, that the liquidator should keep the company as a going concern where possible, and that steps under Section 230 of the Companies Act, 2013 should be taken before outright sale of assets. Only on failure of revival may the liquidator proceed to sale in accordance with law.

Conclusion: The liquidator is required to take steps under Section 230 of the Companies Act, 2013 before proceeding to sell the assets of the corporate debtor.

Final Conclusion: The appeal was disposed of without interference, while preserving the opportunity for the promoter or stakeholders to pursue a compromise or arrangement for revival before any sale of the corporate debtor's assets.

Ratio Decidendi: In liquidation proceedings under the insolvency framework, revival through a compromise or arrangement must be attempted first, and sale of assets is permissible only after such revival efforts fail.

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