Tribunal Orders Liquidation for MBS Impex Private Limited The Tribunal admitted the petition for Corporate Insolvency Resolution Process (CIRP) of M/s. MBS Impex Private Limited and appointed an Interim ...
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Tribunal Orders Liquidation for MBS Impex Private Limited
The Tribunal admitted the petition for Corporate Insolvency Resolution Process (CIRP) of M/s. MBS Impex Private Limited and appointed an Interim Resolution Professional. Due to lack of cooperation from the Directors and delays caused by COVID-19, the Committee of Creditors (CoC) voted for liquidation by 100%. Despite settlement attempts, no progress was made within the timeline. Emphasizing resolution as the primary goal, the Tribunal ordered liquidation, directing the Liquidator to sell the company promptly to maximize asset value. The Liquidator, the Resolution Professional, was given specific instructions for the process, including ceasing moratorium, legal proceedings, and fee entitlement, while discharging officers and employees, except for business continuity cases.
Issues: Application for liquidation of M/s. MBS Impex Private Limited under Section 33(2) of the Insolvency and Bankruptcy Code, 2016.
The Tribunal admitted the petition for Corporate Insolvency Resolution Process (CIRP) of the Company and appointed an Interim Resolution Professional. Due to lack of cooperation from the Directors of the Corporate Debtor and delays caused by the COVID-19 lockdown, the CoC voted in favor of liquidation by 100%. Despite attempts for settlement, no progress was made. The Applicant confirmed that no resolution plan was approved within the prescribed timeline. The Tribunal emphasized that resolution is the primary goal of IBC, but timely action is crucial to prevent asset devaluation, leading to the decision for liquidation.
The Tribunal referenced the Supreme Court ruling emphasizing the importance of selling a firm as a going concern to maximize creditor realization and prevent value destruction due to delays. The appointed Liquidator was directed to sell the Corporate Debtor without delay, following IBC and IBBI regulations to maximize asset value. The order allowed the liquidation of the Corporate Debtor and appointed the Resolution Professional as the Liquidator. Specific directions were given regarding the cessation of moratorium, legal proceedings, transfer of powers to the Liquidator, cooperation from personnel connected with the Corporate Debtor, fee entitlement of the Liquidator, and notification to relevant authorities. The order also served as a discharge notice to officers, employees, and workmen of the Corporate Debtor, except in cases where business continuity is maintained during liquidation.
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