2023 (2) TMI 239 - AT - Insolvency and Bankruptcy

Liquidation of Corporate Debtor - It is the version of the Petitioner that any delay in the Liquidation of the Corporate Debtor, will significantly deplete the Asset Maximisation, thereby, impacting all the Stakeholders of the Corporate Debtor - HELD THAT - It comes to be known that before the Adjudicating Authority, the Appellant, had appeared and filed a Reply, objecting to the Liquidation of the Corporate Debtor, on the premise that the Corporate Debtor, is an MSME and since the Debts are duplicated in both the Corporate Debtors, the Appellant, may be permitted to submit a combined Resolution Plan, qua both the Corporate Debtors, before the Committee of Creditors, and direct them to reconsider the same - The version of the 1st Respondent / Appellant is that, BMW Group is controlling the Committee of Creditors of both the Corporate Debtors, as well as Koyenco Autos Private Limited, having 68.15% and 74.80% Voting Shares, respectively. This Tribunal, on going through the respective contentions advanced on either side, taking into account of the facts and circumstances of the instant case, in a conspectus fashion and also keeping in mind the full Claim of the Petitioner, was admitted by the Liquidator, this Tribunal comes to a consequent conclusion that the Petitioner / Intervenor, is not a necessary or a proper Party, to be arrayed, as one of the Respondents (Viz. proposed 3rd Respondent) and even without the Petitioner s presence, this Tribunal, is enjoined to dispose of the main Appeal. Appeal disposed off.

Summary

Issues:
1. Intervention in the liquidation order by a financial creditor.
2. Feasibility of the consolidated corporate insolvency resolution process.
3. Allegations of delay and obstruction in the liquidation process.
4. Dispute regarding the necessity of the petitioner's presence in the appeal.

Analysis:
1. The petitioner, a financial creditor, sought to intervene in the liquidation order of the corporate debtor. The petitioner argued that the commercial decision of the Committee of Creditors to liquidate the debtor should not be subject to judicial review. The petitioner also highlighted that the debtor's MSME status was obtained after the insolvency application was filed. The petitioner contended that the liquidation process was in the best interest of all stakeholders.

2. The petitioner argued that the consolidated corporate insolvency resolution process was not feasible or beneficial for the debtor or its stakeholders. The petitioner emphasized that the continuation of the liquidation process was essential for asset maximization and stakeholder interests.

3. The respondent, opposing the petitioner's intervention, alleged that the petitioner's claims were fully admitted by the liquidator, making their presence unnecessary in the appeal. The respondent also raised concerns about delays caused by the petitioner's actions and disputed the petitioner's role in the proceedings.

4. After considering the arguments from both sides, the Tribunal concluded that the petitioner's intervention was not necessary or proper in the appeal. The Tribunal noted that the petitioner's claim had been admitted by the liquidator and that the petitioner's presence as a respondent was not required for the appeal's disposal. Therefore, the Tribunal dismissed the petitioner's intervention application, finding it lacking in merit.

In conclusion, the Tribunal dismissed the intervention application of the petitioner in the liquidation order appeal, stating that the petitioner's presence was not essential for the appeal's resolution.