Liquidator discharge refused for incomplete liquidation disclosures, unresolved receivables, litigations, accounts and statutory compliance.

A liquidator is not entitled to discharge merely because the corporate debtor has been sold as a going concern where liquidation issues remain unresolved. Here, the NCLT found incomplete statutory filings, inconsistent disclosures, unresolved receivables, bank guarantees, retention money, pending litigations, project status concerns, and no complete final account of realisations and disbursements. The liquidator's duties were held to continue until a transparent liquidation compliant with the Insolvency and Bankruptcy Code and Liquidation Process Regulations was fully concluded. Discharge was therefore refused at this stage, and a detailed compliance affidavit was directed, with reference made to the insolvency regulator for action.

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Issues: Whether the Liquidator could be permitted to seek discharge on the footing that the corporate debtor had been sold as a going concern; whether the Liquidator had complied with statutory filing and disclosure obligations during liquidation; and whether further directions were required regarding receivables, pending litigations, project status, accounts, and fees.

Analysis: The liquidation record showed that the corporate debtor had been sold as a going concern, but the materials placed before the Authority disclosed unresolved issues concerning unsold assets, receivables, bank guarantees, retention money, statutory filings, and the status of several contracts and projects. The Authority noted inconsistencies in the Liquidator's disclosures, non-compliance with earlier directions, and the absence of a complete final report and full account of realisations and disbursements. It further observed that the Liquidator's obligations continued until a transparent and complete liquidation process was concluded in accordance with the Insolvency and Bankruptcy Code, 2016 and the Liquidation Process Regulations, 2016.

Outcome: The request for discharge was not granted at this stage, and the Liquidator was directed to file a detailed compliance affidavit covering receivables, litigations, project status, accounts, fees, and statutory filings, with a further reference made to the Insolvency and Bankruptcy Board of India for action.

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