Going-concern sale in liquidation must include grouped assets and liabilities; collateral relief on licences and penalties lies outside jurisdiction.

A going-concern sale in liquidation must follow the statutory scheme of grouping the relevant assets and liabilities together; a proposal to sell the corporate debtor as a going concern without liabilities, where only tangible assets were valued and intangible assets such as licences and brand value were omitted, was not permissible. Requests for continuation or renewal of licences, waiver of past non-compliances and penalties, and preservation of incentives and benefits were outside the adjudicating authority's jurisdiction in liquidation, as such reliefs would bind third parties or statutory authorities under other laws. The ancillary requests were therefore rejected, and the liquidator was directed to consider only a commercially viable proposal consistent with the insolvency framework.

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Issues: (i) Whether approval could be granted for sale of the corporate debtor as a going concern by private sale without liabilities, while excluding the assets and liabilities required to be grouped for such sale. (ii) Whether directions sought for continuation or renewal of licences, waiver of past non-compliances and penalties, and continuation of incentives and benefits could be issued in liquidation proceedings.

Issue (i): Whether approval could be granted for sale of the corporate debtor as a going concern by private sale without liabilities, while excluding the assets and liabilities required to be grouped for such sale.

Analysis: The proposed sale was examined against the liquidation framework governing sale as a going concern and private sale. A going concern sale contemplates transfer of the business with the relevant assets and liabilities grouped together, rather than a sale of only tangible assets on an individual valuation basis. The record showed that only tangible assets were valued, while intangible assets such as licences and brand value were not valued at all, even though the proposal sought transfer of the business as a going concern. The proposal was also inconsistent with the prescribed structure for sale as a going concern and with the requirements governing private sale.

Conclusion: The proposal for approval of sale as a going concern without liabilities was not permissible and was rejected.

Issue (ii): Whether directions sought for continuation or renewal of licences, waiver of past non-compliances and penalties, and continuation of incentives and benefits could be issued in liquidation proceedings.

Analysis: The reliefs sought in relation to licences, governmental approvals, waiver of prior defaults, and preservation of benefits were treated as matters outside the adjudicating authority's jurisdiction in liquidation. The order reasoned that liquidation does not confer a power equivalent to approval of a resolution plan and does not authorize directions binding third parties or governmental authorities on matters governed by other statutes. Pending proceedings under other laws were also held to continue notwithstanding liquidation.

Conclusion: The requested ancillary reliefs were outside jurisdiction and were rejected.

Final Conclusion: The application for approval of the proposed private sale as a going concern, along with the connected requests for immunity and ancillary statutory reliefs, was declined, and the liquidator was directed to consider a commercially viable proposal consistent with the insolvency framework.

Ratio Decidendi: A sale of a corporate debtor as a going concern in liquidation must conform to the statutory scheme for grouping assets and liabilities, and the adjudicating authority cannot, in liquidation, grant collateral reliefs affecting statutory licences, penalties, or governmental consequences beyond the insolvency framework.

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