Liquidation under the Insolvency Code follows a creditor vote, and the resolution professional may act as liquidator on consent.

Liquidation under the Insolvency and Bankruptcy Code is triggered where the Committee of Creditors, before approval of any resolution plan, resolves to liquidate the corporate debtor with the prescribed voting threshold. Here, the note states that the CoC approved liquidation with 96.70% voting share after two resolution plans failed and the CIRP period expired. It also explains that section 34 requires the Resolution Professional, subject to written consent, to act as liquidator unless replaced by the Adjudicating Authority, and that the CoC has no role in that appointment decision. On that basis, the corporate debtor was ordered into liquidation and the Resolution Professional was appointed as liquidator.

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Issues: Whether the Corporate Debtor was liable to be ordered into liquidation under section 33(2) of the Insolvency and Bankruptcy Code, 2016, and whether the Resolution Professional was required to be appointed as liquidator under section 34 of the Code.

Analysis: The Committee of Creditors had resolved with 96.70% voting share to liquidate the Corporate Debtor after two resolution plans failed to secure the requisite approval, and the CIRP period had expired. Section 33(2) mandates liquidation when the CoC, before confirmation of a resolution plan, decides to liquidate with the prescribed voting threshold. Section 34(1) provides that, subject to written consent, the Resolution Professional shall act as liquidator unless replaced by the Adjudicating Authority. The Resolution Professional had given consent to act as liquidator, and section 34 does not confer any role on the CoC in the appointment decision.

Conclusion: The Corporate Debtor was rightly ordered into liquidation, and the Resolution Professional was appointed as liquidator.

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