2020 (2) TMI 696 - Tri - Insolvency and Bankruptcy

Liquidation Order - commencement of liquidation and appointment of Liquidator - HELD THAT - The affairs of the Company have been completely wounded-up and its assets are also liquidated as per the statement of facts furnished by the Liquidator as briefly stated. The Liquidator has filed the instant Application/Petition as per extant provisions of the Code and Rules made thereunder. Therefore, there would be no purpose to be served to keep the name of Company on rolls of Registrar of Companies, State of Karnataka. Hence, the Company Petition deserves to be allowed as prayed for. M/s. GTS Coil Private Limited, the Applicant herein, is hereby liquidated with immediate effect.

Summary

Issues:
Liquidation of M/s. GTS Coil Pvt. Ltd. under the Insolvency and Bankruptcy Code, 2016.

Detailed Analysis:
The Company, M/s. GTS Coil Pvt. Ltd., initiated voluntary liquidation under Section 59 of the Insolvency and Bankruptcy Code, 2016, due to financial constraints and lack of business prospects. The Board of Directors passed a resolution for voluntary liquidation, and an Insolvency Professional was appointed as the Liquidator. The only creditor of the Company provided consent for liquidation and submitted their claim. The Liquidator conducted a public announcement for stakeholders to submit claims within 30 days of commencement of liquidation. A bank account was opened for liquidation proceeds, and payments were made to creditors, consultants, and members as per regulations. The Liquidator was able to partially repay the unsecured loan to the creditor, and the remaining amount was waived by the creditor. The total realization amount was distributed towards expenses and unsecured creditors, leaving no balance for equity shareholders. The Liquidator complied with Income Tax Act provisions, obtained a No Objection Certificate from the IT department, and submitted final reports to regulatory authorities.

The Adjudicating Authority carefully reviewed the facts and found that the Company's affairs were wound up, assets liquidated, and all necessary procedures under the Code were followed. Consequently, the Company petition for liquidation was allowed. The Order directed the immediate liquidation of M/s. GTS Coil Pvt. Ltd., forwarding a copy to the Registrar of Companies, Karnataka, and instructing the Liquidator to inform all relevant Statutory Authorities associated with the Company's affairs.

In conclusion, the judgment granted the liquidation of M/s. GTS Coil Pvt. Ltd. under the Insolvency and Bankruptcy Code, 2016, following due process and compliance with regulatory requirements. The detailed analysis highlighted the voluntary liquidation process, creditor consent, distribution of proceeds, compliance with tax regulations, and the final directive for immediate liquidation and communication to relevant authorities.