Liquidation under the Insolvency and Bankruptcy Code ordered after failure of resolution and appointment of a liquidator

The Tribunal found the statutory requirements for liquidation under the Insolvency and Bankruptcy Code satisfied where the Committee of Creditors had resolved to liquidate the corporate debtor, no viable resolution plan had emerged despite repeated invitations, and claims had been invited through public announcement. In the absence of opposition and with written consent of the proposed professional, liquidation was ordered and the proposed professional was appointed as liquidator. Directions were issued for commencement and conduct of liquidation, including cessation of the earlier moratorium and compliance with the liquidation regulations.

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Issues: Whether the corporate debtor should be ordered to be liquidated and a liquidator appointed under the Insolvency and Bankruptcy Code, 2016.

Analysis: The application was filed after the Committee of Creditors resolved to liquidate the corporate debtor in the absence of any viable resolution proposal. The record showed that public announcements had been made, claims had been invited, and no resolution applicant had come forward despite repeated invitations. The Tribunal also noted the absence of opposition and the written consent of the proposed liquidator. In these circumstances, the statutory requirements for liquidation were found to be satisfied, and the directions necessary for commencement and conduct of liquidation, including cessation of the earlier moratorium and compliance with liquidation regulations, were issued.

Conclusion: Liquidation of the corporate debtor was ordered and the proposed professional was appointed as liquidator.

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