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2019 (1) TMI 386 - Tri - Insolvency and BankruptcyLiquidation of the Corporate Debtor viz., M/S. Ashok Magnetics Limited - permission to Liquidator to dispose of the assets of the Corporate Debtor as a going concern basis - Held that - In view of the facts and circumstances recorded by Resolution Professional in MA/ 163/2018 filed in CP/55i/IB/2017, this Adjudicating Authority did not receive any Resolution Plan under Sub-section (6) of Section 30. Therefore, in exercise of powers conferred under Sub-Clauses (i) (ii) and (iii) of Clause (b) of Sub- Section (I) of Section 33 of the I&B Code, 2016, this Authority proceeds to pass Liquidation Order - The Liquidator is also permitted to continue the operations of the Corporate Debtor and allowed to liquidate and dispose of the assets of the Corporate Debtor as a going concern basis - application disposed off.
Issues Involved:
1. Application for liquidation of Corporate Debtor under Sections 33(1)(a) and 34(1) of the Insolvency and Bankruptcy Code, 2016. 2. Approval of Resolution Plans by Committee of Creditors (COCs) within the stipulated time period. 3. Extension of Corporate Insolvency Resolution Process (CIRP) period beyond 180 days. 4. Disposal of assets in liquidation as a "going concern" basis. 5. Appointment of Company Liquidator and cessation of moratorium. Analysis: 1. The Miscellaneous Application was filed seeking an order for liquidation of the Corporate Debtor under Sections 33(1)(a) and 34(1) of the Insolvency and Bankruptcy Code, 2016. The Resolution Professional requested permission for the disposal of assets on a "going concern" basis. The COCs did not object to the liquidation order. 2. The Corporate Insolvency Resolution Process (CIRP) was initiated under Section 7 of the I&B Code by Financial Creditors against the Corporate Debtor. The Resolution Professional was appointed, and the COCs recommended an extension of the CIRP period beyond 180 days. However, no Resolution Plan was approved within the stipulated time frame. 3. The CIRP period was extended by the Authority for 90 days on the COCs' recommendation, which later expired. Despite efforts to solicit Resolution Plans, none were approved by the COCs within the maximum period permitted under the Code. 4. The Resolution Professional highlighted that the offers from Resolution Applicants were deemed too low by the COCs, and the valuation of the factory premises was not considered adequate. As a result, the Adjudicating Authority proceeded to pass a Liquidation Order as per Section 33(1)(a) of the Code. 5. The Liquidation Order appointed the Resolution Professional as the Company Liquidator, ceased the moratorium declared under Section 14 of the I&B Code, and outlined the procedures for liquidation. The Liquidator was permitted to continue the operations of the Corporate Debtor and dispose of assets on a "going concern" basis. The Order also detailed the powers and duties of the Company Liquidator, including fee entitlement and cooperation from Corporate Debtor personnel. This comprehensive analysis of the judgment provides a detailed overview of the issues involved and the decision rendered by the Adjudicating Authority in the matter.
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