Collective liquidation framework prevails where a secured creditor cannot block sale without proving exclusive superior rights over assets.

A dissenting secured creditor cannot prevent liquidation sale merely by refusing to relinquish security interest where the liquidation estate is governed by the collective insolvency framework and the other secured creditors have relinquished their interests. The tribunal held that, in the absence of proof of an exclusive or superior charge over the secured assets, one secured creditor cannot insist on individual realisation in a manner that defeats the liquidation process or the relinquishment decision of the majority. The liquidation sale could therefore proceed, and the process was directed to be completed in accordance with law.

---

---

Issues: (i) Whether the secured creditor's refusal to relinquish security interest could prevent the liquidator from selling the assets under the liquidation process. (ii) Whether the secured creditor had a superior or exclusive right to realize the secured assets so as to override the decision of the other secured creditors who had relinquished their security interests.

Issue (i): Whether the secured creditor's refusal to relinquish security interest could prevent the liquidator from selling the assets under the liquidation process.

Analysis: The liquidation framework permits sale of assets after relinquishment of security interest into the liquidation estate. Where a substantial majority of secured creditors have relinquished their interests, a single dissenting creditor cannot stall the liquidation process by withholding relinquishment, particularly when the assets form part of the same liquidation estate and the proviso to Regulation 32 governs the sale of such assets.

Conclusion: The refusal of one secured creditor to relinquish security interest could not block the sale process, and the liquidator was entitled to proceed with liquidation.

Issue (ii): Whether the secured creditor had a superior or exclusive right to realize the secured assets so as to override the decision of the other secured creditors who had relinquished their security interests.

Analysis: The rights of secured creditors in respect of realization of security interest are controlled by the insolvency framework and, where relevant, the majority-consent principle under the security enforcement regime. On the facts, the creditor did not establish an exclusive superior charge over the secured assets, and the remaining secured creditors, holding the overwhelming value, had already relinquished their interests. The creditor therefore could not insist on individual realization in a manner that would defeat the liquidation process and the collective rights of the other secured creditors.

Conclusion: The secured creditor had no superior or exclusive right that would defeat the liquidation process or the majority relinquishment decision.

Final Conclusion: The impugned order was set aside and the liquidation process was directed to be completed in accordance with law.

Ratio Decidendi: A dissenting secured creditor cannot obstruct liquidation sale where the collective liquidation framework applies and no exclusive superior charge over the secured assets is established.

---