2021 (10) TMI 1340 - Tri - Insolvency and Bankruptcy

Seeking liquidation of the Corporate Debtor - the CIRP period has expired and no resolution plan was approved by the Committee of Creditors (CoC) - HELD THAT - Section 33(1) of the Code enjoins the Adjudicating Authority to pass an order for liquidation of the Corporate Debtor where before the expiry of the insolvency resolution process period or the maximum period permitted for completion of the corporate insolvency resolution process does not receive a resolution plan under sub-section (6) of section 30. Application filed by Mr. Mr. Pankaj Dhanuka, RP of Corporate Power Limited, the Corporate Debtor, is allowed and the Corporate Debtor is ordered to be liquidated in terms of section 33(2) of the Code read with sub-section (1) thereof - application allowed.

Summary

Issues: Application for liquidation of Corporate Debtor due to expiry of CIRP period without an approved resolution plan.

Analysis:
1. The application filed by the Resolution Professional on behalf of the Committee of Creditors sought liquidation of the Corporate Debtor as the CIRP period had expired without an approved resolution plan. The reliefs sought included allowing the application, directing liquidation of the Corporate Debtor, and instructing personnel to cooperate with the Liquidator.

2. The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor based on a petition by a financial creditor. The public announcement for submitting claims was made, and the Committee of Creditors (CoC) was duly constituted with eight financial creditors.

3. Despite efforts to invite Expression of Interests (EOIs) and receiving seven EOIs, the only resolution plan received was found to be non-compliant with the provisions of the Insolvency and Bankruptcy Code, leading to the application for liquidation by the Resolution Professional.

4. The Adjudicating Authority ordered the liquidation of the Corporate Debtor as per section 33(1) of the Code, appointing the Resolution Professional as the Liquidator to carry out the liquidation process in accordance with the Code and regulations. The order included directions regarding the cessation of powers of the Board of Directors, issuance of public notices, and filing copies of the order with the Registrar of Companies.

5. The liquidation order was deemed a notice of discharge to the officers, employees, and workmen of the Corporate Debtor, except for ongoing business matters managed by the Liquidator during the liquidation process. The Liquidator was also directed to file a copy of the order with the Registrar of Companies and the Registry for further action and compliance.

6. The application for liquidation was disposed of with the issuance of necessary directions, including notifying all parties involved, providing a certified copy of the order upon request, and scheduling a progress report on the main Corporate Insolvency Petition for a future date.