2019 (9) TMI 1058 - Tri - Insolvency and Bankruptcy

Liquidation of a Corporate person - company in liquidation - Regulation 14 of the Insolvency Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017 - HELD THAT - In view of the necessary compliances made by the company in liquidation and the Liquidator, this Authority in exercise of the powers conferred under Sub-section (8) of Section 59 of I B Code, 2016 do hereby order the dissolution of the Corporate Person viz., M/s. Sun Asset Reconstruction India Private Limited, from the date of this Order i.e. 15.07.2019. The Corporate Person stands dissolved and the Liquidator stands relieved, who is directed to preserve a physical or an electronic copy of the reports, registers and books of account as referred to in Regulations 8 and 10 of IBBI (Voluntary Liquidation Process), Regulations, 2017, for at least eight (8) year after the dissolution of the Corporate Person, either with himself or with an information utility. Application disposed off.

Issues:
1. Application for dissolution of M/s. Sun Asset Reconstruction India Private Limited.
2. Preservation of company records post liquidation.
3. Compliance with regulatory requirements for voluntary liquidation process.
4. Distribution of assets to shareholders.
5. Completion of the liquidation process and submission of final report.
6. Dissolution of the Corporate Person.

Issue 1: Application for dissolution of M/s. Sun Asset Reconstruction India Private Limited

The Applicant, Mr. P. Sriram, filed CP/505/IB/2019 seeking dissolution of M/s. Sun Asset Reconstruction India Private Limited under Section 59(7) read with Section 59(8) of the Insolvency and Bankruptcy Code, 2016. The company was incorporated under the Companies Act, 2013, with the main object of asset reconstruction acquisition. The application highlighted the decision to voluntarily wind up the company due to inability to meet revised capital requirements set by the Reserve Bank of India for Asset Reconstruction Companies.

Issue 2: Preservation of company records post liquidation

The Applicant requested the preservation of company records for eight years post dissolution. The Liquidator was directed to preserve the books of account and other records for the specified period after the dissolution of the company. This preservation requirement aligns with the provisions of the Insolvency & Bankruptcy Code and ensures compliance with regulatory obligations even after the company's dissolution.

Issue 3: Compliance with regulatory requirements for voluntary liquidation process

The judgment detailed the procedural compliance undertaken by the company in liquidation and the Liquidator. This included the filing of necessary forms with the Registrar of Companies, conducting public announcements, opening a separate bank account, and submission of reports to regulatory authorities. The Liquidator adhered to the Insolvency & Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017, ensuring transparency and compliance throughout the liquidation process.

Issue 4: Distribution of assets to shareholders

Following the completion of the liquidation process, the Liquidator distributed the proceeds to the shareholders of the company. The distribution was made to the contributories at a specified amount per equity share, as per the provisions of the voluntary liquidation process. The Income Tax Officer confirmed no outstanding demands or pending proceedings against the company, validating the distribution process.

Issue 5: Completion of the liquidation process and submission of final report

The Liquidator completed the liquidation process, realizing all assets of the company, meeting expenses and tax payments, and distributing the proceeds to shareholders. A final report consisting of audited accounts showing receipts and payments was prepared and submitted to the Registrar of Companies and the Insolvency & Bankruptcy Board of India. The affairs of the company were fully wound up, leading to the decision for dissolution.

Issue 6: Dissolution of the Corporate Person

Based on the compliances made by the company in liquidation and the Liquidator, the Tribunal ordered the dissolution of M/s. Sun Asset Reconstruction India Private Limited. The Corporate Person was dissolved from the date of the order, with directions for preservation of relevant documents for eight years post-dissolution. The Registry was instructed to forward a copy of the order to the Registrar of Companies, marking the completion of the dissolution process.

This detailed analysis of the judgment showcases the procedural aspects, compliance requirements, and the ultimate decision leading to the dissolution of the Corporate Person, M/s. Sun Asset Reconstruction India Private Limited, following a comprehensive voluntary liquidation process.

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