2022 (1) TMI 212 - Tri - Insolvency and Bankruptcy

Dissolution of the Corporate debtor - section 54(1) of the Insolvency and Bankruptcy Code, 2016 r.w. Regulations 45(3)(b) of the IBBI (Liquidation Process) Regulations, 2016 - HELD THAT - This Authority in the exercise of the powers conferred under section 54(2) of the I.B. Code order the dissolution of the Corporate Debtor viz., M/s. Shree Santosh Cotton Spin Private Limited. Application allowed.

Issues:
1. Application for dissolution of Corporate Debtor under section 54(1) of the Insolvency and Bankruptcy Code, 2016.
2. Compliance with IBBI (Liquidation Process) Regulations, 2016.
3. Distribution of sale proceeds to stakeholders.
4. Final meeting of Stakeholders Consultation Committee for dissolution of Corporate Debtor.
5. Discharge of duties and responsibilities of the Liquidator.
6. Directions to send the order to relevant authorities and parties.

Analysis:
1. The application was filed seeking an order for the dissolution of the Corporate Debtor, M/s. Shree Santosh Cotton Spin Private Limited, under section 54(1) of the Insolvency and Bankruptcy Code, 2016, along with compliance with Regulations 45(3)(b) of the IBBI (Liquidation Process) Regulations, 2016. The Liquidator presented necessary documents and conducted the final meeting of the Stakeholders Consultation Committee, which resolved for the dissolution of the Corporate Debtor.

2. The Liquidator complied with Regulation 45 of the IBBI (Liquidation Process) Regulations, 2016, by filing the Final report and the Compliance Certificate in Form H. The Compliance Certificate detailed the fair value, liquidation value, total realized amount, and the distribution of funds to stakeholders as per section 53 of the IB Code, 2016. The Liquidator also sought and received an extension of the liquidation process.

3. The total available funds for distribution, including the sale consideration, were disclosed, and the Liquidator distributed the amounts to the Financial Creditor and Liquidation Cost as per the prescribed rules. The Liquidator confirmed that all assets were utilized or disposed of for the recovery of dues, leading to the decision for the dissolution of the Corporate Debtor.

4. The Adjudicating Authority, exercising powers under section 54(2) of the I.B. Code, ordered the dissolution of the Corporate Debtor, M/s. Shree Santosh Cotton Spin Private Limited, from the date of the order. Consequently, the Liquidator was discharged from duties and responsibilities, and directions were given to send the order to the Registrar of Companies, Gujarat, the Insolvency and Bankruptcy Board of India (IBBI), and concerned parties for record-keeping within a specified timeframe.

5. The application for dissolution was allowed, and the matter was disposed of in accordance with the order issued by the Adjudicating Authority. The entire process, from the initiation of the insolvency proceedings to the liquidation and eventual dissolution of the Corporate Debtor, was carried out in compliance with the relevant legal provisions and regulations, ensuring the orderly conclusion of the insolvency resolution process.

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