2022 (1) TMI 668 - Tri - Insolvency and Bankruptcy

Seeking a permission for conducting the Private Sale of the Assets of the Corporate Debtor - Regulation 33(2) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 - HELD THAT - Since, the Applicant is in the process of selling the said property under private sale to a related party of the Corporate Debtor, not barred under Section 29A of the IBC, 2016. Where is no objection and multiple attempts of public auction by the Liquidator, this bench is of the view that this is a fit case for granting the permission for private sale of said property as the proposed buyer is related party as under Regulation 33(2) of the Regulations - the present Application is allowed by permitting private sale of said property as under Regulation 33(2) of the Regulations.

Summary

Issues:
Application for permission to conduct private sale of assets of the Corporate Debtor under Regulation 33(2) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016.

Detailed Analysis:

Issue 1: Background and Application
The Liquidator filed an application seeking permission for the private sale of assets of the Corporate Debtor, including immoveable property and equity shares in a subsidiary. The application was filed under Regulation 33(2) of the Regulations, with specific prayers outlined.

Issue 2: Procedural History
The Corporate Insolvency Resolution Process (CIRP) was initiated earlier, leading to liquidation as no Resolution Plan was approved within the statutory period. The Liquidator sought to sell the Corporate Debtor's property through public auctions, but multiple attempts did not yield results due to various reasons, including a nationwide lockdown.

Issue 3: Proposed Private Sale
Following unsuccessful auction attempts, a proposed buyer expressed interest in purchasing the property for a substantial amount. The proposed buyer was related to a Financial Creditor of the Corporate Debtor, necessitating permission for the private sale under Regulation 33(2) of the Regulations.

Issue 4: Market Valuation
To assess the market value of the property, the bench directed the District Collector to provide necessary details. The collector's report indicated a total market value of the property, aligning closely with the reserve price set in the last auction notice.

Issue 5: Sale Proposal Consideration
Considering the lack of available funds and the sole offer from the proposed buyer, the bench deemed the sale proposal as the only viable option for the liquidation process. The proposed sale was in line with the provisions of Regulation 33(2) of the Regulations.

Issue 6: Regulatory Compliance
The decision to permit the private sale was made after ensuring compliance with Section 29A of the IBC, 2016, and the specific requirements outlined in Regulation 33(2) regarding private sales to related parties of the Corporate Debtor.

Conclusion
Given the circumstances, lack of objections, and the efforts made by the Liquidator, the bench granted permission for the private sale of the property as requested in the application under Regulation 33(2) of the Regulations. The application was allowed and disposed of accordingly.