CIRP exclusion and liquidation: majority creditor wisdom prevailed, and liquidation was rejected in favour of resolution prospects.

The article notes that the Committee of Creditors' overwhelming approval of a 60-day exclusion from the Corporate Insolvency Resolution Process was treated as an exercise of commercial wisdom, given pending litigation, continued resolution prospects and other CIRP developments. It also states that liquidation is a last resort in insolvency, and that the corporate debtor's substantial assets and viable resolution possibility weighed against liquidation. The dissent of a small minority financial creditor was considered insufficient to displace the majority view. On that basis, the exclusion was upheld and the request for liquidation was rejected.

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Issues: Whether the exclusion of 60 days from the Corporate Insolvency Resolution Process was justified, and whether the request for liquidation of the corporate debtor was liable to be accepted.

Analysis: The Committee of Creditors approved exclusion of 60 days by a very large majority after considering pending litigation, the possibility of receipt and consideration of a resolution plan, and other CIRP-related developments. The Tribunal treated the CoC's decision as an exercise of commercial wisdom, noted that liquidation is the last resort under the insolvency framework, and found that the corporate debtor still had substantial assets and a viable resolution possibility. The dissent of a small minority financial creditor was held insufficient to displace the majority view of the CoC.

Conclusion: The exclusion of 60 days was upheld and the prayer for liquidation was rejected.

Final Conclusion: The appeals failed, and the orders allowing exclusion of time and declining liquidation were sustained.

Ratio Decidendi: A decision of the Committee of Creditors taken by overwhelming majority in favour of granting CIRP exclusion, based on continuing resolution prospects, should not be interfered with at the instance of a dissenting minority creditor, particularly where liquidation would defeat the object of resolution.

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