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2022 (8) TMI 176 - Tri - Insolvency and BankruptcyDissolution of the Corporate Debtor - Section 54 of the Insolvency Bankruptcy Code, 2016 - HELD THAT - The affairs of the Corporate Debtor have been wound up and its assets have been completely liquidated. It is noted that the erstwhile promoters and Suspended Directors of the Corporate Debtor had absconded and as a consequence of this, the process of liquidation of the Corporate Debtor was inordinately delayed. Hence, the period of 137 days between 19th February 2022 to 5th July 2022 shall be excluded from the period of Liquidation of the Corporate Debtor. It is satisfying from the documents on record that the liquidation is not with intent to defraud any person. The bank account for the purpose of liquidation has been closed. The facts and circumstances indicate that due process of liquidation, as per extant provisions and in the manner indicated in the Code and Regulations, have been followed by the Liquidator to liquidate the assets of Company. The liquidation process has been duly completed as per the provisions of the Code. Thus, it would be just and equitable for this Tribunal to dissolve the Corporate Debtor. No party is going to be adversely affected thereby. The Corporate Debtor deserves to be dissolved - Application allowed.
Issues involved: Application for dissolution of Corporate Debtor under Section 54 of the Insolvency & Bankruptcy Code, 2016.
Analysis: 1. Admission of Company Petition and CIRP Proceedings: The Tribunal noted that the Operational Creditor's Company Petition was admitted, and an Interim Resolution Professional (IRP) was appointed. The Committee of Creditors (CoC) was constituted, and several meetings were held during the Corporate Insolvency Resolution Process (CIRP). 2. Appointment of Resolution Professional and CoC Membership: Following CoC approval, a Resolution Professional (RP) was appointed, and the CoC membership was expanded to include Lakshmi Vilas Bank. The claims of the financial creditors were detailed, along with their security interests. 3. Liquidation Process Initiation: Due to the unviability of the Corporate Debtor, the CoC passed a resolution for liquidation under Section 33 of the Code. The Liquidation commenced, and the RP was appointed as the Liquidator, who was later replaced by the present Applicant. 4. Stakeholder Claims and Progress Reports: The Applicant conducted a public announcement for stakeholder claims and submitted progress reports, including the constitution of the Stakeholders Consultation Committee (SCC) and voting share details. 5. SCC Meetings and Dissolution Decision: The SCC held multiple meetings, addressing issues such as criminal complaints against Suspended Directors and the untraceability of promoters. Eventually, the SCC authorized the Applicant to file for the dissolution of the Corporate Debtor under Section 54 of the Code. 6. Final Dissolution and Financial Details: The Applicant submitted numerous progress reports and a final report for dissolution. Financial details, including bank statements and contributions received, were provided. The Tribunal found that the Corporate Debtor's affairs were wound up, assets liquidated, and the process completed as per legal provisions. 7. Tribunal's Findings and Order: The Tribunal excluded a specific period from the liquidation process due to delays caused by absconding promoters and Suspended Directors. It concluded that the liquidation was not fraudulent, all processes were followed correctly, and dissolution was just and equitable. Consequently, the Corporate Debtor was ordered to be dissolved immediately, with necessary actions to be taken by the Registry and the discharge of the Liquidator. This detailed analysis covers the key aspects of the judgment, from the initiation of insolvency proceedings to the final dissolution of the Corporate Debtor, highlighting the legal procedures and findings of the Tribunal.
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