2019 (9) TMI 1052 - Tri - Insolvency and Bankruptcy

Approval of Liquidation for M/s. RLS Alloys Private Limited: Directive for Company Liquidator

The tribunal approved the liquidation of the Corporate Debtor, M/s. RLS Alloys Private Limited, following the unanimous decision of the Committee of ... Maintainability of application - initiation of CIRP - liquidation of the Corporate Debtor - HELD THAT:- The Resolution Professional has filed the present application seeking order for liquidation of the Corporate Debtor viz., M/s.RLS Alloys Private Limited. Since, no Resolution Plan has been received by this Authority under Sub-section (6) of Section 30 of the I&B Code, 2016, before the expiry of the maximum period of 180 days of CIR Process, the Corporate Debtor has to be ordered for Liquidation. Application allowed. Issues:Liquidation of Corporate DebtorAnalysis:The judgment pertains to an application filed under Section 33(2) of the Insolvency and Bankruptcy Code, 2016, seeking the liquidation of the Corporate Debtor, M/s. RLS Alloys Private Limited. The Resolution Professional requested the tribunal to pass an order for liquidation, appoint the Resolution Professional as the Liquidator, and pass any other necessary orders. The case originated from an application filed by an Operational Creditor against the Corporate Debtor, which led to the initiation of the Corporate Insolvency Resolution (CIR) process. The Resolution Professional was appointed as the Interim Resolution Professional (IRP) during the proceedings.Following the initiation of the CIR process, the Resolution Professional managed the affairs of the Corporate Debtor, invited claims from creditors, and constituted the Committee of Creditors (CoC). Despite efforts to solicit Resolution Plans, no viable options were presented. The CoC, comprising a Sole Financial Creditor with 100% voting rights, unanimously decided that the business was not salvageable due to the dilapidated machinery and lack of operational activity by the Promoters.Consequently, in a meeting, the CoC unanimously passed a resolution for the liquidation of the Corporate Debtor. The Resolution Professional filed an application seeking the tribunal's approval for liquidation as no Resolution Plan was received within the stipulated timeframe of the CIR process. The tribunal, in exercise of its powers under the Insolvency and Bankruptcy Code, 2016, proceeded to issue the Liquidation Order.The Liquidation Order entailed various directives, including appointing the Resolution Professional as the Company Liquidator, ceasing the moratorium, transferring the powers of the Corporate Debtor's management to the Liquidator, and outlining procedures for legal proceedings during liquidation. The Order emphasized the cooperation required from the Corporate Debtor's personnel and specified the Liquidator's entitlement to fees as per regulations. Additionally, instructions were provided for dissemination of the Order to relevant authorities for compliance purposes.Ultimately, the tribunal allowed the Resolution Professional's application for liquidation against the Corporate Debtor, M/s. RLS Alloys Private Limited, and directed the Registry to communicate the Order to the appointed Company Liquidator promptly. The judgment was pronounced in an open court setting, concluding the legal proceedings related to the liquidation of the said Corporate Debtor.