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2020 (9) TMI 512 - Tri - Insolvency and BankruptcyApproval of Resolution Plan - Section 30(6) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - There being no other resolution Applicant and also considering the fact that the CIRP has already ended, this Bench, left with Hobson s choice, orders liquidation of the Corporate Debtor as provided under Section 33 (1) (b) (i) of the Code. In view of the rejection of the resolution plan, the Corporate Debtor i.e. Guruashish Constructions Private Limited, shall be liquidated in the manner as laid down in Chapter-III of the Code with directions specified.
Issues:
1. Approval of Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016. 2. Eligibility of Resolution Applicant under Section 29A of the Code. 3. Liquidation of the Corporate Debtor under Section 33 of the Code. Approval of Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016: The Tribunal considered the application by the Resolution Professional seeking approval of the Resolution Plan submitted by M/s Ravi Developments under Section 30(6) of the Code. The Corporate Insolvency Resolution Process (CIRP) was initiated, and the Resolution Professional was confirmed by the Committee of Creditors (CoC). The CoC approved the resolution plan with a significant voting share, leading to the submission for approval before the Tribunal. However, subsequent events regarding the Resolution Applicant's financial position and withdrawal of the plan raised concerns regarding the application's validity. Eligibility of Resolution Applicant under Section 29A of the Code: The Tribunal analyzed Section 29A of the Code, which outlines the eligibility criteria for a resolution applicant. It was highlighted that if the Resolution Applicant's account is classified as a non-performing asset (NPA), they are ineligible to submit a resolution plan. In this case, the Resolution Applicant's account was declared as an NPA, rendering them ineligible to continue as a Resolution Applicant. Consequently, the application for approval of the resolution plan was dismissed based on the provisions of Section 29A of the Code. Liquidation of the Corporate Debtor under Section 33 of the Code: Considering the rejection of the resolution plan and the ineligibility of the Resolution Applicant under Section 29A, the Tribunal invoked Section 33 of the Code to order the liquidation of the Corporate Debtor. With no viable resolution applicant and the conclusion of the CIRP period, the Tribunal had no alternative but to proceed with liquidation as per the statutory provisions. The Resolution Professional was appointed as the Liquidator, and necessary directions were issued for the commencement of the liquidation process in accordance with the Code's stipulations. This comprehensive analysis of the judgment by the National Company Law Tribunal, Mumbai Bench, showcases the meticulous consideration of the issues surrounding the approval of the resolution plan, the eligibility of the Resolution Applicant, and the subsequent liquidation of the Corporate Debtor as per the provisions of the Insolvency and Bankruptcy Code, 2016.
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