Liquidation under insolvency law follows a valid creditors' resolution, with the resolution professional appointed subject to authorisation compliance.

Where the committee of creditors validly resolves that no resolution is possible and approves liquidation with the prescribed voting share, the Adjudicating Authority is bound to order liquidation under the Insolvency and Bankruptcy Code. The resolution professional may be appointed as liquidator if consent is given and the authorisation requirements under the Code and the insolvency professional regulations are met. The liquidation stage then commences, with the liquidator assuming control and the board's authority ceasing as a statutory consequence.

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Issues: Whether the corporate debtor should be ordered into liquidation on the basis of the committee of creditors' unanimous decision and whether the resolution professional could be appointed as liquidator.

Analysis: The application was made after the committee of creditors resolved, with 100% voting share, that there was no real possibility of a resolution and that liquidation should follow. Section 33(2) of the Insolvency and Bankruptcy Code, 2016 requires the Adjudicating Authority to order liquidation where such a decision is communicated by the resolution professional and approved by not less than the prescribed voting share. The record also showed consent from the resolution professional to act as liquidator, subject to holding a valid Authorisation for Assignment, as contemplated by Section 34(1) of the Code and Regulation 7A of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2019.

Conclusion: The corporate debtor was ordered to be liquidated, and the resolution professional was appointed as liquidator subject to compliance with the applicable authorisation requirement.

Final Conclusion: The liquidation stage of the corporate insolvency resolution process was directed to commence, with consequential statutory effects including transfer of powers to the liquidator and cessation of the board's authority.

Ratio Decidendi: Where the committee of creditors validly resolves to liquidate the corporate debtor and the statutory voting threshold is satisfied, the Adjudicating Authority is bound to pass a liquidation order and appoint a qualified liquidator in accordance with the Code.

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