Liquidation under the Insolvency Code follows when no resolution plan is received and creditors resolve to liquidate the corporate debtor.

Where no approved resolution plan is received within the CIRP period and the Committee of Creditors unanimously resolves to liquidate, the Adjudicating Authority may order liquidation under section 33(1)(b) of the Insolvency and Bankruptcy Code, 2016. The Tribunal noted that the statutory conditions for liquidation were satisfied because no resolution plan had been received under section 30(6). It therefore ordered liquidation of the corporate debtor, appointed a liquidator, directed cessation of moratorium, and required the liquidation to proceed under Chapter III of Part II of the Code and the Liquidation Process Regulations, including an attempt to sell the corporate debtor or its business as a going concern.

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Issues: Whether, on failure to receive an approved resolution plan and on the recommendation of the Committee of Creditors, liquidation of the corporate debtor should be ordered and a liquidator appointed.

Analysis: The application was supported by the resolution professional on the basis that the Committee of Creditors had unanimously resolved to liquidate the corporate debtor after no resolution plan was received within the CIRP period. The Adjudicating Authority noted that no resolution plan had been received under section 30(6) of the Insolvency and Bankruptcy Code, 2016, and that the statutory conditions for liquidation under section 33(1)(b) stood satisfied. The order also provided for cessation of moratorium, vesting of powers in the liquidator, and conduct of liquidation in accordance with Chapter III of Part II of the Code and the Liquidation Process Regulations, including an endeavour to first sell the corporate debtor or its business as a going concern.

Conclusion: Liquidation was ordered and the liquidator was appointed.

Final Conclusion: The corporate insolvency process was brought to an end by liquidation, and the connected claims filed by operational creditors became infructuous.

Ratio Decidendi: Where no resolution plan is received and the Committee of Creditors resolves to liquidate, the Adjudicating Authority may order liquidation and appoint a liquidator under section 33 of the Insolvency and Bankruptcy Code, 2016.

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