2022 (4) TMI 570 - Tri - Insolvency and Bankruptcy

Seeking liquidation of the Corporate Debtor - Section 33(2) and 34(1) of Insolvency and Bankruptcy Code, 2016 - HELD THAT - Since the COC in its commercial wisdom has decided to take the Corporate Debtor into liquidation, it is opined that the decision of COC should not be interfered. The present application seeking liquidation of the Corporate Debtor M/s. Eagle Corporation Private Limited, in the manner laid down in Chapter III of Part II of the Code is allowed. Application allowed.

Summary

Issues:
1. Application for liquidation of the Corporate Debtor, M/s. Eagle Corporation Private Limited under Sections 33(2) and 34(1) of the Insolvency and Bankruptcy Code, 2016.

Detailed Analysis:

1. Background and CIRP Process:
The application was filed by the Resolution Professional (RP) seeking liquidation of the Corporate Debtor, M/s. Eagle Corporation Private Limited. The Corporate Insolvency Resolution Process (CIRP) was initiated by an Operational Creditor, and various meetings of the Committee of Creditors (CoC) were held to manage the affairs of the Corporate Debtor.

2. Trust Deficit and Change of RP:
Issues arose during the CIRP process, including a trust deficit between the CoC and the RP, leading to the extension of the CIRP period and the change of RP. The CoC expressed dissatisfaction with the conduct of the CIRP by the erstwhile RP.

3. Meetings and Resolution Plans:
Multiple meetings of the CoC were conducted to discuss the resolution plans, costs of CIRP, and the sale of assets. Various resolutions were passed, including the approval of resolution plans and exclusion of certain time periods from the CIRP timeline.

4. Decision for Liquidation:
The CoC, in its commercial wisdom, decided to liquidate the Corporate Debtor, M/s. Eagle Corporation Private Limited. The Tribunal upheld the decision of the CoC and allowed the application for liquidation in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016.

5. Appointment of Liquidator:
The Tribunal appointed a new RP as the Liquidator for the Corporate Debtor, with specific directions regarding the liquidation process, investigation of financial affairs, and submission of reports within the stipulated timelines.

6. Consequences and Communication:
The admission of the application for liquidation resulted in the cessation of the moratorium under Section 14 of the Code, initiating a fresh moratorium under Section 33(5). The order was communicated to relevant parties, including the RP, Corporate Debtor, Liquidator, IBBI, and ROC for necessary actions and compliance.

This detailed analysis encapsulates the key events, decisions, and legal provisions surrounding the application for liquidation of M/s. Eagle Corporation Private Limited as per the judgment delivered by the National Company Law Tribunal, Ahmedabad Bench.