2019 (7) TMI 1357 - Tri - Insolvency and Bankruptcy

Max Machinery Co. granted voluntary liquidation petition under Insolvency Code

The Tribunal allowed the voluntary liquidation petition of the applicant company, 'Max Machinery Manufacturing Company Private Limited,' under Section 59 ... Voluntary liquidation - dissolution of the applicant company - Section 59 of Insolvency and Bankruptcy Code, 2016 - HELD THAT:- On perusal of the material available on record, goes on to show that the Board of Directors of the Company has taken a conscious decision to close down the company due to non-availability of business prospects and non-availability of long-term financial resources, thus, as per them, it would not be a wise decision to carry on the business activities of the company from the economic point of view. Therefore, Company’s Board of Directors proposed to liquidate the company voluntarily by invoking the provisions of Section 59 of the IBC - It is also made clear through the present petition that the Applicant Company is having no creditors, i.e. either secured creditors or unsecured creditors. Thus the company was having its own resources and net worth, which are already distributed / apportioned of among its shareholders. The company has duly passed necessary Special Resolution in its Extraordinary General Meeting (EOGM) on 08th December, 2017 by confirming the decision of its Board of Directors by proposing its Voluntary Liquidation. As per the material available on record, it is found that the Liquidator, after his appointment duly performed his duties and completed necessary formalities so as to complete process of liquidation, which are well narrated in the present petition and thereafter he sought an order from this Tribunal for dissolution of the applicant company - Since there is no objection received from any angle opposing the voluntary liquidation of the company either from shareholders’ side or from secured and unsecured creditors side or any adverse comments from public at large against such proposed liquidation, despite a public announcement was made by the liquidator in the website of the Insolvency and Bankruptcy Board of India (IBBI). Since nothing adverse is found from the material available on record in respect of opposing the proposed liquidation of the corporate person, the present application deserves to be allowed - Petition allowed. Issues Involved:1. Voluntary liquidation of the applicant company under Section 59 of the Insolvency and Bankruptcy Code, 2016.2. Compliance with procedural requirements for voluntary liquidation.3. Appointment and duties of the Liquidator.4. Communication of liquidation process to statutory authorities.5. Absence of objections from stakeholders and public.Detailed Analysis:1. Voluntary Liquidation of the Applicant Company:The applicant company, 'Max Machinery Manufacturing Company Private Limited,' sought voluntary liquidation under Section 59 of the Insolvency and Bankruptcy Code, 2016. The Board of Directors decided to close down the company due to non-availability of business prospects and long-term financial resources, making it financially unviable to continue operations.2. Compliance with Procedural Requirements:The procedural requirements for voluntary liquidation were meticulously followed. The company passed a special resolution in its Extraordinary General Meeting (EOGM) on 8th December 2017, confirming the Board's decision and appointing Mr. Umesh Ved as the Liquidator. The necessary declaration was made by the Directors, accompanied by audited financial statements and business records for the previous two years. The declaration and other documents were filed with the Registrar of Companies, Gujarat.3. Appointment and Duties of the Liquidator:Mr. Umesh Ved, a Practicing Company Secretary and Insolvency Professional, was appointed as the Liquidator. He performed his duties diligently, including making a public announcement of the commencement of liquidation, opening a bank account for realization and payment to members, and submitting a preliminary report to the Corporate Person. He also obtained a 'No Objection Certificate' from statutory authorities and distributed the corpus of Rs. 1,83,75,000/- among the members of the company.4. Communication to Statutory Authorities:The liquidation process was communicated to the Registrar of Companies, Gujarat, and the Insolvency and Bankruptcy Board of India (IBBI) through appropriate forms (MGT-14 and GNL-2). The Liquidator also informed the Income Tax Department and obtained necessary certificates from other statutory authorities, including the surrender of the company's registration certificates for Central Excise, Service Tax, and VAT.5. Absence of Objections:No objections were received from shareholders, secured or unsecured creditors, or the public. The public announcement was made on the IBBI website, and no adverse comments were received. The Central Government did not make any representation against the petition despite being given proper notice and sufficient opportunities.Conclusion:The Tribunal, after examining the merits of the petition and ensuring compliance with Section 59 of the Insolvency and Bankruptcy Code, 2016, allowed the petition. The company, 'Max Machinery Manufacturing Company Private Limited,' was ordered to be dissolved with effect from 29th May 2019. The Liquidator was directed to communicate the order to the Registrar of Companies, Gujarat, IBBI, and other concerned statutory authorities within fourteen days. The Company Petition was allowed and disposed of accordingly.