2021 (10) TMI 764 - Tri - Insolvency and Bankruptcy

Liquidation order granted under I&B Code due to absence of resolution plans.

In Re : Lanco Solar Private Limited

In Re : Lanco Solar Private Limited - TMI Issues:1. Liquidation order sought by Resolution Professional under Sections 33(2) and 34(4)(c) of I & B Code, 2016.2. Extension of CIRP period requested by Committee of Creditors (CoC) beyond 180 days.3. Decision on liquidation process due to absence of resolution plans.4. Approval of liquidation costs and sale of assets during liquidation process.5. Appointment and duties of Liquidator.Analysis:Issue 1: Liquidation OrderThe Resolution Professional filed an Application seeking a liquidation order for the Corporate Debtor under Sections 33(2) and 34(4)(c) of the I & B Code, 2016. Since no Resolution Plan was received, the Adjudicating Authority granted the liquidation order as prayed for. The Liquidation process was ordered to be conducted as per Chapter III of the Code, and Mr. Huzefa Fakhri Sitabkhan was appointed as the Liquidator.Issue 2: Extension of CIRP PeriodThe CoC, with a 100% vote, requested an extension of the CIRP period by 90 days beyond the initial 180 days. The Adjudicating Authority granted the extension based on the progress in the CIRP. The last day for submitting the Resolution Plan was extended accordingly, but no plans were received by the deadline.Issue 3: Decision on LiquidationDue to the absence of any resolution plans and the opinion of the majority of CoC members, it was decided in the 10th CoC meeting to proceed with the liquidation of the Corporate Debtor. The CoC passed a resolution to initiate the liquidation process, considering the lack of interest from potential investors and the potential deterioration in asset value.Issue 4: Approval of Liquidation Costs and Asset SaleThe CoC approved the estimated net liquidation cost for one year and the contribution plan by CoC members. Additionally, the CoC recommended, by a 92.07% vote, to sell the assets of the Corporate Debtor as a going concern or on an individual basis during the liquidation process.Issue 5: Appointment and Duties of LiquidatorMr. Huzefa Fakhri Sitabkhan was appointed as the Liquidator, with responsibilities outlined in the Order. The Liquidator was directed to file consent to act within 7 days, issue a public announcement, and manage the affairs of the Corporate Debtor during liquidation. The Liquidator's fees were fixed as per the decision of the CoC.In conclusion, the Adjudicating Authority approved the liquidation order, appointed the Liquidator, and outlined the necessary steps for the liquidation process, asset sale, and management during liquidation.