2021 (5) TMI 78 - Tri - Insolvency and Bankruptcy

Dissolution of the Corporate Debtor - Sections 54 and 60 (5) of the Insolvency Bankruptcy Code, 2016 (the Code) read with Rule 11 of the National Company Law Tribunal Rules, 2016 - HELD THAT - It appears that the affairs of the Corporate Debtor have been wound up and its assets have been completely liquidated. The documents on record are satisfying that the liquidation is not with intent to defraud any person. The bank account for the purpose of liquidation has been closed. The above facts and circumstances indicate that due process of liquidation, as per extant provisions and in the manner indicated in the Code and Regulations, have been followed by the Liquidator to liquidate the assets of Company and the realized amounts have also been distributed among the respective claimants. The liquidation process has been duly completed as per the provisions of the Code. Thus, it would be just and equitable for this Authority to dissolve the Corporate Debtor. No party is going to be adversely affected thereby. In view of the above the Corporate Debtor deserves to be dissolved. Application allowed.

Issues Involved:
1. Admission of Corporate Insolvency Resolution Process (CIRP).
2. Formation and decisions of the Committee of Creditors (CoC).
3. Appointment and actions of the Interim Resolution Professional (IRP) and Resolution Professional (RP).
4. Liquidation process and appointment of Liquidator.
5. Distribution of assets and settlement of claims.
6. Finalization and closure of liquidation process.

Issue-wise Detailed Analysis:

1. Admission of Corporate Insolvency Resolution Process (CIRP):
The Company Petition under Section 9 of the Insolvency & Bankruptcy Code, 2016 seeking CIRP of the Corporate Debtor was admitted by the Tribunal on 23.02.2018. Mr. Sanjay Kumar Ruia was appointed as the Interim Resolution Professional (IRP).

2. Formation and Decisions of the Committee of Creditors (CoC):
The IRP published public announcements for claims submission and formed the CoC based on received claims. The CoC consisted solely of Operational Creditors as no Financial Creditor filed any claim. The CoC held its first meeting on 11.04.2018 and noted that the Corporate Debtor had no operations or assets, leading to the decision to liquidate the company.

3. Appointment and Actions of the Interim Resolution Professional (IRP) and Resolution Professional (RP):
The CoC requested the IRP to continue as the RP without additional fees, which he accepted. The RP filed an application for liquidation on behalf of the CoC, which was allowed on 29.08.2019. Due to a show cause notice from the Insolvency and Bankruptcy Board of India, Mr. Ruia was barred from acting as IRP/RP or Liquidator, prompting the CoC to appoint a new Liquidator.

4. Liquidation Process and Appointment of Liquidator:
The CoC unanimously appointed Mrs. Dipti Atul Mehta as the Liquidator on 30.08.2018. She took charge on 05.09.2018 and made public announcements. The liquidation status was updated with statutory authorities and banks. The Tribunal waived the appointment of a registered valuer as the Corporate Debtor had no assets to be valued.

5. Distribution of Assets and Settlement of Claims:
The Corporate Debtor received various tax refunds, which were deposited into a liquidation account. The Liquidator held consultation meetings with stakeholders to discuss the distribution of funds. The distribution was made in two tranches, and all professional fees were paid as per invoices. The Liquidator closed all bank accounts of the Corporate Debtor and transferred the funds to the liquidation account for distribution among creditors.

6. Finalization and Closure of Liquidation Process:
The Liquidator prepared the Final Report and submitted it to the Tribunal and relevant authorities. The compliance certificate under Regulation 45(3) was also prepared. The Tribunal examined the submissions and documents, confirming that the liquidation process was conducted per the Code and Regulations. The Tribunal ordered the dissolution of the Corporate Debtor, directed the Registry to forward a certified copy to the Registrar of Companies, and discharged the Liquidator.

Conclusion:
The Tribunal concluded that the liquidation process was completed as per the provisions of the Insolvency & Bankruptcy Code, 2016. The Corporate Debtor was dissolved with immediate effect, and the Liquidator was discharged. The case CP No. 1584/IBC/NCLT/MB/MAH/2017 was closed.

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