Winding up transfer to NCLT refused after liquidation reached an irreversible stage and asset realisation had substantially progressed.

Transfer of winding up proceedings to the NCLT was refused because the company's liquidation had already reached an irreversible stage. The record showed prior sickness declaration, a winding up recommendation under the SICA regime, appointment of the Official Liquidator, invitation of claims, and substantial steps taken toward sale and realisation of assets over a long period. The Court noted that immovable property was under acquisition, movable assets had been taken over and sold, and available assets were insufficient to meet liabilities. On that factual basis, speculative possibilities of future release of acquired land did not justify transfer, and the order declining transfer was sustained.

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Issues: Whether the winding up proceedings ought to be transferred to the National Company Law Tribunal under the Insolvency and Bankruptcy Code, 2016 on the ground that no irreversible steps had been taken in the winding up process.

Analysis: The record showed that the company had been declared sick, a recommendation for winding up had already been made under the Sick Industrial Companies (Special Provisions) Act, 1985, the Official Liquidator had been appointed, claims had been invited, and substantial steps towards sale and liquidation of assets had been taken over a long period. The immovable asset was under acquisition, the movable assets had been taken over and sold, and the available assets were insufficient to meet the liabilities. In these circumstances, the winding up had progressed to an irreversible stage, and speculative possibilities of future release of acquired land did not justify transfer.

Conclusion: The request for transfer to the National Company Law Tribunal was rejected, and the finding that irreversible steps had been taken was upheld.

Final Conclusion: The appeal failed and the order declining transfer of the winding up proceedings was sustained.

Ratio Decidendi: Transfer of winding up proceedings to the National Company Law Tribunal is not warranted once the liquidation process has substantially advanced and irreversible steps have been taken in relation to the company's assets and liabilities.

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