2019 (3) TMI 1651 - Tri - Insolvency and Bankruptcy

Liquidation of the Corporate Debtor - approval of the CoC during corporate insolvency resolution process - HELD THAT - The Corporate Debtor is liquidated in the manner as laid down in the Chapter by issuing a Public Notice stating that the Corporate Debtor is in liquidation with a direction to the Liquidator to send this order to RoC under which this Company has been registered. As to the appointment of Liquidator Mr. Rajat Mukherjee is at this moment directed to act as a Liquidator for the liquidation of Corporate Debtor company with all powers as envisaged in the Code. Application admitted - moratorium declared.

Summary

Issues:
Liquidation of Corporate Debtor under Section 33 of IBC, 2016 based on CoC approval during CIRP.

Analysis:
1. The Resolution Professional filed MA 1096/2019 for liquidation of the Corporate Debtor Enviiro Bulkk Handling Systems Pvt Ltd under Section 33 of IBC, 2016, following CoC approval during the corporate insolvency resolution process.
2. The application highlighted the admission of CP(IB) 1319/2017 and the appointment of IRP for CIRP completion within 180 days, extended by 90 days by Tribunal orders.
3. Multiple CoC meetings were conducted during CIRP, culminating in the rejection of Jyotiba Developers' resolution plan in the 10th meeting on 8.3.2019 due to valuation concerns and non-compliance with IBC provisions.
4. The CoC unanimously rejected the resolution plan, leading to the recommendation for the Corporate Debtor's liquidation as a going concern.
5. The Hon'ble Supreme Court precedent emphasized limited judicial review over CoC decisions, barring interference in commercial judgments during resolution plan approval/rejection.
6. CoC's decision to reject the resolution plan with 100% vote share aligned with the legal framework and commercial autonomy principles.
7. The appointment of Mr. Rajat Mukherjee as Liquidator was proposed and approved by CoC, complying with the necessary procedures and obtaining requisite consents.
8. The Tribunal, acknowledging the CoC's decision and compliance with legal requirements, ordered the liquidation of the Corporate Debtor under Section 33 of IBC.
9. The order specified the liquidation process, appointment of Liquidator, cessation of powers of existing management, cooperation obligations, fee structure, and moratorium implications.
10. The moratorium declared earlier ceased to exist, and MA No. 1096/2019 in CP-1319/2017 was allowed, with directions for immediate communication to the Applicant and Liquidator for compliance reporting.

This detailed analysis encapsulates the legal judgment's key aspects, including procedural history, CoC decisions, judicial precedents, Liquidator appointment, and the final liquidation order under the IBC provisions.