2022 (1) TMI 399 - Tri - Insolvency and Bankruptcy

Withdrawal of CIRP application - section 12A of the Insolvency and Bankruptcy Code, 2016 read with Rule 11 of the NCLT Rules, 2016 - HELD THAT - As such, as on date, there are no claims that have been pending before the Liquidator. The fees and expenses of the Resolution Professional and the Liquidator have also been duly paid by the ex-directors of the Corporate Debtor. Copies of the relevant documents evidencing such payments are also annexed to the application and marked as Annexure 'D'. Liquidation process initiated against the Corporate Debtor vide order dated 17/05/2019 is hereby closed. Board of Directors of the Corporate Debtor is restored to its original position. Liquidator is discharged from his responsibility. Application allowed.

Summary

Issues: Application for withdrawal of Corporate Insolvency Resolution Process (CIRP) under Section 12A of the Insolvency and Bankruptcy Code, 2016.

Analysis:
1. Background and Application: The application, filed under Section 12A of the Insolvency and Bankruptcy Code, 2016, sought withdrawal of the Corporate Debtor from the CIRP. The applicant, a Shareholder/Ex-Director of the company, referenced previous orders related to the matter and highlighted the primary claim by the Employees' State Insurance Corporation (ESIC) amounting to ?5,71,867. The applicant contended that this claim was settled, and no other financial or operational creditors had lodged any claims. Additionally, all fees and expenses of the Resolution Professional and Liquidator were duly paid by the ex-directors, as evidenced by annexed documents.

2. Legal Precedent and Decision: The applicant's counsel relied on a judgment by the Hon'ble NCLAT, emphasizing that during the liquidation period, if a person satisfies the demands of the Committee of Creditors, withdrawal of the application under Section 7 of the I&B Code is permissible. Based on the grounds presented and submissions made in court, the tribunal decided to recall the orders admitting the Corporate Debtor to CIRP and subsequent liquidation. The tribunal ordered the closure of the liquidation process, restoration of the Board of Directors to their original position, discharge of the Liquidator from responsibilities, and directed the handover of all assets, books of account, and documents to the Board of Directors.

3. Disposition of Applications: Following the directions given in the judgment, both the application for withdrawal of CIRP and the initial CIRP order were disposed of. All other pending applications were also deemed disposed of, and the file was consigned to records, marking the conclusion of the legal proceedings in this matter.