2023 (7) TMI 1396 - AT - Insolvency and Bankruptcy

Seeking extension of CIRP beyond the period of 330 days - liquidation of the Corporate Debtor - HELD THAT - There are no substance in the argument of Appellant because the CoC had time and again extended the period which was allowed by the Adjudicating Authority but two resolution plans in respect of the Corporate Debtor were rejected with the majority of the vote of 91.92% by the CoC and at that time the CoC was aware that 330 days time period in respect of the Corporate Debtor had already been over. Moreover, it has been categorically observed by the Adjudicating Authority that neither any plan was pending nor any application under Section 12A of the Code was pending for their consideration, therefore, the period of CIRP cannot be extended on the flimsy grounds much beyond the period of 330 days as has been held by the Hon ble Supreme Court in the case of Essar Steels Through Authorised Signatory 2019 (11) TMI 731 - SUPREME COURT . Therefore, the applications filed for extension of time by the RP has rightly been dismissed and the application filed by the RP for an order of liquidation of the Corporate Debtor has rightly been passed which does not require interference by this Tribunal. There are no merit in the present appeal and the same is hereby dismissed.

Summary

Issues involved: Appeal against order dismissing extension of CIRP period and allowing liquidation of Corporate Debtor.

Summary:
1. The appeal was filed by the Promoter and erstwhile Director of a company, challenging the order passed by the Adjudicating Authority dismissing the applications seeking extension of the Corporate Insolvency Resolution Process (CIRP) period beyond 330 days and allowing liquidation of the Corporate Debtor.

2. The CIRP proceedings for the Corporate Debtor were initiated on a specific date, and various orders were passed by the National Company Law Appellate Tribunal (NCLAT) in response to appeals and applications filed during the process.

3. The Resolution Professional (RP) filed multiple applications seeking extension of the CIRP period, but the Committee of Creditors (CoC) did not approve any resolution plans, leading to the RP filing an application for liquidation of the Corporate Debtor.

4. The Adjudicating Authority, considering legal precedents and the absence of pending resolution plans or Section 12A applications, held that the CIRP must be completed within 330 days unless exceptional circumstances exist. The applications for extension were dismissed, and the liquidation order was allowed.

5. The Appellant's argument regarding a pending extension application was refuted, emphasizing that the CoC had already rejected two resolution plans, and no further plans were pending for consideration.

6. The NCLAT upheld the Adjudicating Authority's decision, stating that the RP's actions did not warrant further extension of the CIRP period beyond 330 days, as per legal guidelines and the specific circumstances of the case.

7. The appeal was dismissed, with no costs imposed, as the Tribunal found no merit in challenging the orders of the Adjudicating Authority regarding the CIRP extension and liquidation of the Corporate Debtor.