2021 (6) TMI 844 - Tri - Insolvency and Bankruptcy

Tribunal Orders Corporate Debtor Dissolution: Liquidation Process Validated

Global Rural Netco Limited Versus Evershine Advisory Services Private Limited

Global Rural Netco Limited Versus Evershine Advisory Services Private Limited - TMI Issues Involved:Application for dissolution of the Corporate Debtor under Sections 54 and 60(5) of the Insolvency & Bankruptcy Code, 2016.Detailed Analysis:1. Background and CIRP Process: The Tribunal admitted a Company Petition under Section 7 of the Code for Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor. The Interim Resolution Professional (IRP) was appointed, and the IRP undertook various actions, including calling for claims and conducting meetings with the Committee of Creditors (CoC).2. Appointment of Resolution Professional and Valuers: The IRP was appointed as the Resolution Professional (RP) after the first meeting of the CoC. The RP engaged Registered Valuers and a Forensic Auditor to assess the Corporate Debtor's situation. The Information Memorandum was prepared and circulated among the CoC members.3. Initiation of Liquidation Process: Despite efforts to find a resolution plan, no viable option emerged, leading the CoC to unanimously decide to initiate the liquidation process against the Corporate Debtor. The Tribunal then directed the liquidation and appointed the Applicant as the Liquidator.4. Liquidation Process and Stakeholder Meetings: The Liquidator took charge, made public announcements, and informed relevant authorities about the liquidation. Claims were received and stakeholders were engaged through meetings. The stakeholders decided to file a Dissolution Application, which was subsequently done by the Applicant.5. Distribution of Assets and Closure: The Liquidator distributed the available funds to stakeholders as per the provisions of the Code. Bank accounts were closed, and undertakings were obtained from former Directors regarding pending litigation and liabilities. The Liquidator also sought clearance from the Income Tax Authority.6. Final Compliance and Dissolution: The Liquidator prepared the Final Report, complied with regulations, and submitted necessary documents to the authorities. The Tribunal, after reviewing the submissions and documents, found that the liquidation process was conducted properly without any intent to defraud. Consequently, the Corporate Debtor was dissolved, and the Liquidator was discharged.In conclusion, the Tribunal's detailed analysis and order reflect a comprehensive review of the entire insolvency and liquidation process, ensuring compliance with legal requirements and the fair distribution of assets to stakeholders before ultimately ordering the dissolution of the Corporate Debtor.