Liquidation must begin with revival efforts under Section 230 before any sale of the corporate debtor's business or assets.

In liquidation under the Insolvency and Bankruptcy Code, revival efforts must be attempted first through a compromise or arrangement under Section 230 of the Companies Act, 2013 before the liquidator proceeds to sale of the corporate debtor's business or assets. Liquidation is treated as a last resort, with continuation of the corporate debtor as the primary objective. Only if the revival attempt fails may the liquidator sell the business as a going concern and, thereafter, the assets in accordance with law.

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Issues: (i) Whether, in a liquidation proceeding under the Insolvency and Bankruptcy Code, the liquidator must first take steps for compromise or arrangement under Section 230 of the Companies Act, 2013 before proceeding with sale of the corporate debtor's assets.

Analysis: Liquidation is treated as a last resort under insolvency law, with revival and continuation of the corporate debtor as the primary object. The liquidation process must therefore begin by exploring a compromise or arrangement under Section 230 of the Companies Act, 2013. Only if such revival effort fails may the liquidator proceed to sell the business as a going concern, and thereafter resort to sale of assets in accordance with law. The framework under the Insolvency and Bankruptcy Code also requires the liquidator to verify claims, take custody and control of assets, consolidate and adjudicate claims, and proceed consistently with the statutory scheme.

Conclusion: The liquidator is required to proceed first under Section 230 of the Companies Act, 2013, and only on failure of revival may sale of the corporate debtor's business or assets be undertaken.

Final Conclusion: The liquidation order was not interfered with, but the liquidator was directed to pursue revival-oriented steps under the Companies Act before effecting sale of the corporate debtor's assets.

Ratio Decidendi: In liquidation, the statutory scheme requires revival efforts through compromise or arrangement to be exhausted before resorting to sale of the corporate debtor's business or assets.

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