2019 (10) TMI 1452 - Tri - Insolvency and Bankruptcy

Liquidation of Corporate Debtor - Sections 33 34 of Insolvency Bankruptcy Code, 2016 - HELD THAT - As per Section 33(1) (a) of the Code, if the Resolution Plan has not received under Section 30(6) with in CIRP period, the Tribunal has no other option but to pass a liquidation order. The Resolution Professional has not filed any Resolution Plan before this Tribunal under Section 30(6) with in CIRP period. By relying on Section 33(1) (a) of the Code, the Resolution Professional having not submitted any Resolution Plan within CIRP period leads to passing an order of liquidation - there are no other alternative except passing an order of liquidation requiring the Corporate Debtor/ Taksheel Solutions Limited to be liquidated in the manner laid down in Chapter 3 of Part 2 of the Insolvency and Bankruptcy Code, 2016. The Application is allowed and Corporate Debtor Taksheel Solutions Limited is ordered to be liquidated.

Summary

Issues involved:
Liquidation order sought by Resolution Professional under Sections 33 & 34 of Insolvency & Bankruptcy Code, 2016.

Analysis:
- The Tribunal admitted the petition under Section 9 of IBC, 2016, initiating Corporate Insolvency Resolution Process against the Corporate Debtor. The Resolution Professional was appointed to replace the Interim Resolution Professional.
- The Committee of Creditors (CoC) received claims from various creditors and appointed a Resolution Professional unanimously in the Second Meeting. Subsequent meetings discussed eligibility criteria for Expression of Interest (EOI).
- Despite issuing a public announcement inviting EOIs, no responses were received from prospective resolution applicants until the deadline.
- In the Fifth Meeting, the CoC resolved to liquidate the Corporate Debtor due to the absence of any EOI responses. The Resolution Professional expressed inability to continue as Liquidator.
- The Resolution Professional filed an application seeking liquidation of the Corporate Debtor under Sections 33 & 34 of the Code, which was approved by the CoC with 100% voting share.
- Section 33 of the Code mandates liquidation if no resolution plan is received within the CIRP period. Since no plan was submitted, the Tribunal passed the order of liquidation.
- Following the liquidation order, the Resolution Professional appointed for the CIRP process acts as the Liquidator. A new Liquidator was nominated due to the previous Professional's inability to continue.
- The Tribunal allowed the application, ordering the liquidation of the Corporate Debtor, directing the Liquidator to proceed as per the Code and Regulations.
- All powers of the Corporate Debtor's management cease to have effect, vested in the Liquidator. A Public Announcement of liquidation is required, and the moratorium order ceases to have effect.
- The Liquidator is authorized to initiate legal proceedings as necessary, subject to approval, and fees are to be paid as per regulations. A Preliminary Report must be submitted within the specified time frame.

This detailed analysis covers the key aspects of the judgment, outlining the process leading to the liquidation order and the subsequent steps to be taken in accordance with the Insolvency & Bankruptcy Code, 2016.