2021 (6) TMI 527 - Tri - Insolvency and Bankruptcy

Seeking Extension of The Liquidation Process of the Corporate Debtor - Regulation 44 of The IBBI (Liquidation Process) Regulations, 2016 r.w. Rule 11 of NCLT Rules, 2016 - HELD THAT - It is stated that the Corporate Debtor has been ordered to be Liquidated vide an Order dated 17.12.2019 passed by this Tribunal. Thereafter the present Applicant was appointed as the Liquidator of the Corporate Debtor - The Applicant carried out necessary actions under the Code and in consultation with the CoC has taken every possible effort for resolution of the Corporate Debtor. However, no EOI was received and the CoC resolved to put the Corporate Debtor in to Liquidation. The application is partly allowed and the period to complete the liquidation process is hereby extended by six months from today.

Summary

Issues:
Extension of the liquidation process of the Corporate Debtor due to the COVID-19 pandemic.

Analysis:
1. The application sought an extension of the liquidation process of the Corporate Debtor, M/s. Broadcast Audience Research Council, due to the impact of the COVID-19 pandemic. The Applicant requested exclusion of 162 days from the timeframe and a further extension of six months beyond the original deadline of 04.06.2021.

2. The Corporate Debtor had been ordered to be liquidated in December 2019, and the Applicant was appointed as the Liquidator. The application asserted that it was not barred by the Law of Limitation or the provisions of the Insolvency and Bankruptcy Code, 2016.

3. The Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor commenced in January 2019, and the Applicant, initially appointed as the Interim Resolution Professional, was confirmed as the Resolution Professional by the Committee of Creditors (CoC).

4. Despite efforts for resolution, including inviting claims from stakeholders and admitting verified claims, the Corporate Debtor could not be resolved, leading to the decision for liquidation. The Applicant commenced the liquidation process after receiving the Order for Liquidation in December 2019.

5. The Applicant faced challenges in progressing with the liquidation process due to the COVID-19 pandemic and the subsequent nationwide lockdown. The Applicant filed necessary reports and initiated asset selling activities after preparing the Asset Memorandum.

6. Considering the extraordinary circumstances caused by the pandemic, the Tribunal partially allowed the application, extending the period for completing the liquidation process by six months. The period during the lockdown was excluded from the calculation, following the decision of the Hon'ble Supreme Court in a related matter.

7. The Tribunal referred to the Supreme Court's order, which extended the period of limitation for judicial proceedings due to the COVID-19 situation. The Tribunal's decision to grant an extension aligned with the Supreme Court's direction, ensuring the completion of the liquidation process without being hindered by the pandemic-induced challenges.

This detailed analysis covers the issues raised in the judgment, the background of the case, the Applicant's submissions, the Tribunal's decision, and the legal implications of the extension granted due to the COVID-19 pandemic.