9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (12) TMI 1352 - Tri - Insolvency and BankruptcyDissolution of the Corporate Debtor - Section 54(2) of I B Code - Release of closing balance in liquidation bank account and fixed Deposit Account to stakeholders/Liquidation expenses - HELD THAT - The dues of the Government are not considered as a secured debt under Section 3(31) of the Code, do not get precedence over secured creditors under Section 53 and do not fall in Clause(b) of Section 53, but fall under Clause(e) of Section 53 - Hence, it is clear that amount dues to the Central Govt. and State Govt. shall be paid after the dues of the financial secured creditors are paid. In this case, the admitted dues of the secured creditor were ₹ 139.60 Crores, whereas the liquidation proceeds of ₹ 35.60 crores could only satisfy 25.5% of the secured financial creditor's admitted dues. Hence, there is no assets available for payment of dues of the Income Tax Deptt., Govt. of India and State Tax Deptt., Govt. of Gujarat. Hence, the claims of the Income Tax Dept for the assessment for the year 2009-2010 and 2012-13 are not paid as there is no liquidation assets left over for payment to the Income Tax Deptt. Matter disposed off.
Issues Involved:
1. Dissolution of the Corporate Debtor under Section 54(2) of the Insolvency and Bankruptcy Code, 2016. 2. Release of closing balance in liquidation bank account and fixed deposit account to stakeholders. 3. Discharge of the Liquidator from his duties. 4. Pending appeals and applications related to the liquidation process. 5. Distribution of assets under Section 53 of the Insolvency and Bankruptcy Code, 2016. Issue-wise Detailed Analysis: 1. Dissolution of the Corporate Debtor under Section 54(2) of the Insolvency and Bankruptcy Code, 2016: The Liquidator filed an application under Section 54(2) of the Insolvency and Bankruptcy Code, 2016, seeking the dissolution of the Corporate Debtor, New Tech Forge & Foundry Limited. The Tribunal noted that the Corporate Debtor had been under liquidation since 12/12/2017, and all assets had been liquidated. The final report submitted by the Liquidator indicated that there were no further assets to be utilized for recovery of dues. Consequently, the Tribunal ordered the dissolution of the Corporate Debtor with effect from 18.12.2019, in accordance with Section 54 of the Code. 2. Release of closing balance in liquidation bank account and fixed deposit account to stakeholders: The Liquidator requested the release of the closing balance in the liquidation bank account and fixed deposit account to stakeholders as per Section 53 of the Code. The Tribunal noted the balance in the liquidation bank account as ?2,07,197 and ?18,00,000 in the fixed deposit account. The Tribunal directed that any amount received as interest or other receipt/refund subsequent to 21.04.2019 be distributed as per Section 53 of the Code. 3. Discharge of the Liquidator from his duties: The Liquidator sought discharge from his duties upon completion of the liquidation process. The Tribunal directed the Liquidator to prepare a report in the form of an affidavit, detailing the costs incurred in the liquidation process, including fees for auditors, advocates, and the Liquidator. This report was to be filed with the Registry within seven days of the order. Upon filing the report, the Liquidator would be discharged automatically from his duties. 4. Pending appeals and applications related to the liquidation process: Several appeals and applications were pending in relation to the liquidation process, including: - IA 128 of 2018 by personal guarantors seeking initiation of their own insolvency. - Appeals No. 2 and 3 of 2019 by the State Tax Officer challenging the liquidation process and seeking condonation of delay. - IA 106 and 107 of 2019 by the State Tax Officer regarding unpaid dues and delay in filing appeals. - IA 143 of 2019 by the buyer of the property seeking removal of attachment/charge on the properties. The Tribunal addressed each of these matters, allowing condonation of delay for the State Tax Officer but denying any payment due to lack of assets. The Tribunal also directed the removal of attachment/charge on the properties sold to the highest bidder, M/s. Haq Steel & Metallik Private Ltd. 5. Distribution of assets under Section 53 of the Insolvency and Bankruptcy Code, 2016: The Tribunal emphasized the distribution of assets as per Section 53 of the Code. It was noted that the proceeds from the sale of liquidation assets amounted to ?35.60 crores, which only satisfied 25.5% of the secured financial creditors' admitted dues. Consequently, there were no assets available for payment of dues to the Income Tax Department and State Tax Department. The Tribunal reiterated that government dues do not have precedence over secured creditors under Section 53 and fall under Clause (e) of Section 53. Conclusion: The Tribunal concluded that the Liquidator had complied with all statutory procedures for the liquidation process and ordered the dissolution of the Corporate Debtor. The Liquidator was directed to file a final report detailing the costs incurred, and upon filing, he would be discharged from his duties. The Tribunal also addressed and disposed of all pending appeals and applications related to the liquidation process.
|
