Liquidation under insolvency law follows a valid creditors' resolution, while CIRP fees may be limited to reasonable and supported amounts.

Where the Committee of Creditors validly resolved to liquidate the corporate debtor and the statutory conditions for liquidation were satisfied, the Adjudicating Authority ordered liquidation and noted the usual consequences, including cessation of the moratorium and vesting of powers in the liquidator. The resolution professional's fee and expense claim was not accepted in full; the amount was restricted to what was considered reasonable for the CIRP period, with only limited additional allowance for the lockdown period and out-of-pocket expenses, and expenses incurred after filing of the liquidation application were disallowed.

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Issues: (i) Whether the corporate debtor was liable to be placed into liquidation on the basis of the Committee of Creditors' decision under Section 33(2) of the Insolvency and Bankruptcy Code, 2016; (ii) Whether the resolution professional's claim for fees and expenses, including amounts beyond the stipulated CIRP period, should be allowed in full or restricted.

Issue (i): Whether the corporate debtor was liable to be placed into liquidation on the basis of the Committee of Creditors' decision under Section 33(2) of the Insolvency and Bankruptcy Code, 2016.

Analysis: The Committee of Creditors had resolved to liquidate the corporate debtor and to appoint the resolution professional as liquidator. The application was moved after the liquidation decision, and the statutory preconditions for liquidation under Section 33 were found satisfied. The order also recorded the consequences that follow upon liquidation, including cessation of the moratorium under Section 14 and vesting of powers in the liquidator.

Conclusion: The issue was decided in favour of liquidation, and the corporate debtor was directed to be liquidated with immediate effect.

Issue (ii): Whether the resolution professional's claim for fees and expenses, including amounts beyond the stipulated CIRP period, should be allowed in full or restricted.

Analysis: The claimed amounts were found to be excessive in light of the limited work involved and the absence of justification for the full claim. The allowed amount was confined to the maximum stipulated CIRP period, with a limited additional amount for the lockdown period and a further allowance towards out-of-pocket expenses. No amount was allowed for expenses incurred after the liquidation application was filed.

Conclusion: The claim was partly allowed and restricted to a quantified amount, with the balance disallowed.

Final Conclusion: Liquidation was ordered, the resolution professional was appointed as liquidator, and the monetary claim was curtailed to a reduced sum while later expenses were rejected.

Ratio Decidendi: Once the Committee of Creditors validly resolves to liquidate the corporate debtor and the statutory conditions under Section 33 are met, the Adjudicating Authority must pass the liquidation order, while claims for CIRP fees and expenses may be confined to amounts that are reasonable and supported by the scope and duration of the proceedings.

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