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2021 (11) TMI 234 - Tri - Insolvency and BankruptcyLiquidation of Corporate Debtor - Section 33(1), 33(2) and 34(1) of the Insolvency Bankruptcy Code - HELD THAT - It is noted that the company is not having assets and funds to meets the liabilities of the Corporate Debtor. The COC in the meeting dated 02.06.2021 passed a resolution to Liquidate the Corporate Debtor by 100% votes. The COC has also assessed the liquidation costs and remuneration of the Liquidator as per Regulation 39B 39C of the CIRP Regulation. The shortfall in Liquidation of Corporate Debtor shall be born by the members of COC. The COC could not explore to sale as a going concern on the ground that no assets of Corporate Debtor exist. The COC has also resolved in the said meeting to appoint the applicant (RP) Liquidator who has also given consent to act as a Liquidator. The order of liquidation of the Corporate Debtor is allowed - application allowed.
Issues: Liquidation order for Corporate Debtor M/s. RJVS Traders Private Limited
Analysis: 1. Initiation of CIRP: The Adjudicating Authority initiated Corporate Insolvency Resolution Process against the Corporate Debtor due to default in paying operational debt. An Interim Resolution Professional was appointed. 2. Claims Submission and COC Formation: Creditors submitted claims, and the Committee of Creditors (COC) was formed, consisting of two members. The COC confirmed the Resolution Professional and decided against appointing a registered valuer due to lack of assets. 3. Decision for Liquidation: The COC, in a meeting, decided not to publish Expression of Interest due to the absence of assets or funds, opting for liquidation. Liquidation costs were assessed, and the Liquidator's remuneration was determined. 4. Liquidation Order: The Tribunal noted the lack of assets and funds, leading to a unanimous decision by the COC to liquidate the Corporate Debtor. The Liquidator was appointed, and the order of liquidation was passed, effective immediately, ceasing the moratorium. 5. Legal Proceedings and Liquidator Appointment: Legal proceedings against the Corporate Debtor were restricted, except with the Liquidator's approval. The Resolution Professional was appointed as the Liquidator to oversee the liquidation process as per the Insolvency and Bankruptcy Code and Regulations. 6. Discharge Notice and Communication: The liquidation order served as a discharge notice to officers, employees, and workmen, except for ongoing business. The registry was directed to communicate the order to relevant parties and update the Corporate Debtor's status with the Registrar of Companies. This detailed analysis covers the key aspects of the judgment, including the CIRP initiation, COC decisions, liquidation order, legal proceedings, Liquidator appointment, and communication directives for the effective implementation of the liquidation process for the Corporate Debtor.
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