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2021 (2) TMI 461 - Tri - IBCLiquidation of the Corporate Debtor - Section 33(1) of IBC, 2016 - HELD THAT - In order to state that the Adjudicating Authority can approve the Liquidation of Corporate Debtor Company without taking any steps for resolution of the Corporate Debtor, the Applicant has referred to a decision of the Hon ble NCLAT in the matter of Sunil S. Kakkad Vs. Altrium Infocom Private Limited 2020 (8) TMI 392 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI . This Tribunal heard the learned counsel appearing for the Resolution Professional and had gone through all the case records including the Resolution passed by the Committee of Creditors in the 2nd meeting held on 07.12.2020, and being satisfied with the conditions enshrined in the CIRP Regulations and ordered that Corporate Debtor M/s. Auto Friction Components India Private Limited is hereby put under liquidation with immediate effect under Section 33(1) of IBC, 2016. Application allowed.
Issues Involved:
Liquidation of Company under Section 33(2) of IBC, 2016; Appointment of Resolution Professional as Liquidator. Detailed Analysis: 1. Background and Application: The Interlocutory Application was filed under Section 33(2) of IBC, 2016 by the Resolution Professional seeking orders for the liquidation of the company and the appointment of the Resolution Professional as the Liquidator. The Applicant was appointed as the Interim Resolution Professional earlier. 2. Public Announcement and Claims: The Applicant made a Public Announcement inviting creditors to submit their claims as per the IBBI regulations. Claims were admitted up to a certain date, and no claims were received from workmen/employees/authorized representatives till that date. 3. Committee of Creditors' Decision: The Committee of Creditors, in its first meeting, acknowledged the challenges in reviving the company as a going concern due to various reasons such as the company's strike-off status, lack of signatories, non-filing of statutory returns, and the dilapidated condition of the factory premises. 4. Resolution for Liquidation: Subsequently, in the second meeting of the Committee of Creditors, it was resolved to liquidate the company under Section 33(2) of IBC without going through the CIRP process. Reasons included the company's non-functional status, lack of existing employees, absence of significant assets apart from land, and the unavailability of liquid assets to cover liquidation costs. 5. Legal Basis for Liquidation: The Applicant cited a decision of the NCLAT to support the proposition that the Adjudicating Authority can approve the liquidation of a company without pursuing resolution steps. 6. Appointment of Liquidator: The Committee of Creditors, with 100% voting rights, resolved to appoint the Resolution Professional as the Liquidator. The Liquidator's fee and estimated liquidation costs were discussed and agreed upon by the Committee. 7. Order for Liquidation: After reviewing the case records and the Committee's resolutions, the Tribunal ordered the immediate liquidation of the company under Section 33(1) of IBC, 2016. The Resolution Professional was appointed as the Liquidator, with directions to manage the liquidation process as per the provisions of the Code. 8. Operational Directives: The order specified various operational directives for the Liquidator, including ceasing the powers of the existing management, issuing public notices, and coordinating with government authorities. The moratorium declared earlier ceased to exist with the issuance of the liquidation order. 9. Conclusion: The Tribunal disposed of the Interlocutory Application, authorizing the Resolution Professional to act as the Liquidator for the purpose of liquidating the company, and providing necessary directions and authorities to facilitate the liquidation process effectively.
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