2021 (4) TMI 1147 - Tri - Insolvency and Bankruptcy

Dissolution of Corporate Debtor - assets of the Corporate Debtor have been fully liquidated - Section 54 of the Insolvency and Bankruptcy Code, 2016 (IB Code) r.w. Regulation 14 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 - HELD THAT - Considering the facts and invoking various provisions of the Law, and finding that the assets of the Corporate Debtor have been fully and completely liquidated to the satisfaction of the Creditors, there remains nothing to keep the Corporate Debtor/Company alive. The Corporate Debtor stands dissolved from the date of this order as per the Section 54(2) of the Insolvency and Bankruptcy Code, 2016 - application allowed.

Issues:
1. Application for dissolution of Corporate Debtor under Section 54 of IB Code.
2. Compliance with Liquidation Regulations and statutory requirements.
3. Liquidation process and submission of reports by the liquidator.
4. Dissolution of the Corporate Debtor based on complete liquidation of assets.

Issue 1: Application for dissolution of Corporate Debtor under Section 54 of IB Code

The liquidator filed an application seeking the order of dissolution of the Corporate Debtor under Section 54 of the Insolvency and Bankruptcy Code, 2016, along with Regulation 14 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016. The application was based on the ground that the assets of the Corporate Debtor, M/s. Orbis Infinium Private Limited, had been fully liquidated. The Corporate Debtor was admitted into Corporate Insolvency Resolution Process (CIRP) and subsequently into liquidation due to the absence of assets and business operations, leading to the decision for dissolution.

Issue 2: Compliance with Liquidation Regulations and statutory requirements

The Committee of Creditors (COC) appointed the Resolution Professional (RP) as the liquidator after deciding to liquidate the Corporate Debtor in compliance with the Liquidation Regulations. The liquidator fulfilled various statutory compliances under the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, including the submission of progress reports and the final report on liquidation. The liquidator also formed the Stakeholder Consultation Committee (SCC) based on the list of stakeholders, ensuring adherence to the regulatory framework.

Issue 3: Liquidation process and submission of reports by the liquidator

The liquidator, based on the Audit Report of the Corporate Debtor, confirmed the absence of any tangible or intangible assets. Subsequently, the liquidator submitted a Preliminary Report and a Final Report on liquidation to the Adjudicating Authority, indicating the lack of pending litigations against the Corporate Debtor. The liquidator's compliance with the regulations and submission of detailed reports facilitated the decision-making process for the dissolution of the Corporate Debtor.

Issue 4: Dissolution of the Corporate Debtor based on complete liquidation of assets

After reviewing the application, reports, and compliance documents, the Adjudicating Authority invoked Section 54(2) of the Insolvency and Bankruptcy Code, 2016, which allows for the dissolution of the Corporate Debtor upon complete liquidation. The Authority found that the assets of the Corporate Debtor had been fully liquidated to the satisfaction of the Creditors, leading to the decision to dissolve M/s. Orbis Infinium Private Limited. The order for dissolution was issued, and necessary communication was directed to the Registrar of Companies for further action, thereby concluding the liquidation process effectively.

This detailed analysis of the judgment highlights the procedural aspects, regulatory compliance, and legal provisions involved in the dissolution of the Corporate Debtor, providing a comprehensive overview of the case.

← Previous Next →