2022 (5) TMI 1045 - Tri - Insolvency and Bankruptcy

Seeking dissolution of the Corporate Debtor - section 54 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT -There is no impediment to the Corporate Debtor being dissolved, and it is ordered accordingly. The Corporate Debtor is ordered to be liquidated - application allowed.

Summary

Issues:
1. Application under section 54 of the Insolvency and Bankruptcy Code for dissolution of the Corporate Debtor.
2. Liquidation process and insufficient assets to cover costs.
3. Payment of fees and costs to the Liquidator.
4. Disposal of related applications post dissolution order.

Analysis:

Issue 1: Application under section 54 of the Insolvency and Bankruptcy Code for dissolution of the Corporate Debtor
The Tribunal considered an application filed under section 54 of the Insolvency and Bankruptcy Code, 2016, seeking dissolution of the Corporate Debtor. The Corporate Debtor was admitted under Corporate Insolvency Resolution Process (CIRP) and subsequently liquidated due to the inability to resolve its stressed assets. The Liquidator filed a Preliminary Report and a "NIL" list of Stakeholder Consultation Committee in compliance with regulations. It was noted that no creditors, except Indian Bank, had filed claims, leading to the inability to constitute a Stakeholder Consultation Committee. The Liquidator confirmed the lack of liquid saleable assets and the insufficiency of available assets to cover liquidation costs. The Tribunal, considering the circumstances, ordered the dissolution of the Corporate Debtor under section 54 of the Code.

Issue 2: Liquidation process and insufficient assets to cover costs
The Liquidator reported that the Corporate Debtor's only available asset, a commercial vehicle, could not cover the incurred Liquidation Process Cost. Additionally, no other liquid saleable asset was identified, indicating the inadequacy of realizable properties to cover liquidation expenses. The Liquidator sought direction for the payment of fees and costs by Indian Bank, confirmed in the 8th Committee of Creditors (CoC) meeting. The Tribunal directed the CoC to pay the approved fees and costs to the Liquidator, emphasizing the financial challenges faced during the liquidation process.

Issue 3: Payment of fees and costs to the Liquidator
The Liquidator highlighted the pending payment of fees and costs by Indian Bank, as confirmed in the 8th CoC meeting. The Tribunal directed the CoC to ensure the payment of fees and costs to the Liquidator as approved, emphasizing the importance of fulfilling financial obligations towards the Liquidator for their services during the liquidation process.

Issue 4: Disposal of related applications post dissolution order
Following the order for the dissolution of the Corporate Debtor, related applications, IA(I.B.C.)/470(KB)2020 and IA(I.B.C)/154(KB)2021, were deemed infructuous and dismissed accordingly. The Registry was directed to inform all parties and their counsels of the order and to issue certified copies upon compliance with formalities. The file was to be consigned to the record, concluding the proceedings post the dissolution order.