2021 (8) TMI 269 - Tri - Insolvency and Bankruptcy

Corporate Debtor Faces Liquidation Following CoC Rejection: Compliance with IBC Regulations

The Tribunal ordered the liquidation of the corporate debtor under section 33 of the Insolvency and Bankruptcy Code, 2016, due to the rejection of the ... Seeking for the liquidation of the corporate debtor - section 33(2) of the Insolvency and Bankruptcy Code, 2016 read with rules 11 and 32 of the National Company Law Tribunal Rules, 2016 - HELD THAT:- This Adjudicating Authority granted exclusion and extension of the CIRP period. However, it is placed that no viable resolution plan was voted at the CoC. Hence, this Adjudicating Authority has left with no option but to order liquidation. Taking into consideration, the written consent dated January 6, 2021 of the applicant IRP to act as a liquidator filed on January 28, 2021, Mr. Ramakrishnan Sadasivan, is appointed as the liquidator of the corporate debtor to carry out the liquidation process subject to the terms of the directions. The liquidation order passed - application allowed. Issues: Liquidation of corporate debtor under section 33(2) of the Insolvency and Bankruptcy Code, 2016.Analysis:1. The application was filed by the resolution professional seeking liquidation of the corporate debtor under section 33(2) of the Insolvency and Bankruptcy Code, 2016. The corporate insolvency resolution process was initiated by the Tribunal, and the resolution professional was appointed subsequently. The CoC meetings were conducted, and various steps were taken in accordance with the regulations.2. The applicant appointed registered valuers to determine the fair value and liquidation value of the assets of the corporate debtor. The fair and liquidation values were calculated for the land and building of the corporate debtor. Expression of interest was published, and claims were submitted by interested parties. The resolution plan submitted was rejected by the CoC members, leading to the decision for liquidation of the corporate debtor.3. An application for an extension of the time limit was filed, and subsequently, the application for liquidation of the corporate debtor was submitted. The CoC members voted against the plan, resulting in the decision for liquidation. The Tribunal considered the provisions of section 33 of the IBC, 2016, and the absence of opposition from the promoters/directors of the corporate debtor, ordering the liquidation.4. In the subsequent CoC meeting, the members unanimously decided to appoint a liquidator for the corporate debtor. Since no viable resolution plan was approved, the Tribunal had to order liquidation. The appointed liquidator was directed to act in accordance with the IBC, 2016, and related regulations, conduct investigations, and comply with various statutory requirements.5. The order of moratorium was lifted, and a fresh moratorium under section 33(5) of the IBC commenced. The liquidator was instructed to proceed with the liquidation process as per the specified regulations and submit reports within the stipulated timelines. The order was communicated to relevant authorities and stakeholders for necessary actions and cooperation in the liquidation process.