2021 (9) TMI 115 - Tri - Insolvency and Bankruptcy

Liquidation of Corporate Debtor - Section 33(2) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - Despite all possible steps as required under the Code taken during the CIRP, the CoC did not receive any viable resolution plan/proposal for revival of the Company. The CoC in its wisdom has resolved with 91.04% voting share in favour of the liquidation of the Corporate Debtor as a going concern. The Applicant RP has given his consent to act as Liquidator. This Authority has no reason before it to take a contrary view in terms of Section 33(1)(a) of the Code. Therefore, it has no option than to pass an order for liquidation of the Company in the manner laid down in Chapter III of the Code. The Corporate Debtor is ordered to be liquidated - application allowed.

Summary

Issues Involved:
Application for Liquidation Process under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 against Neo Corp International Limited.

Analysis:

1. Corporate Insolvency Resolution Process (CIRP) Initiation:
The CIRP of the Corporate Debtor was initiated upon admission of a Petition under Section 9 of the Code, leading to the appointment of an Interim Resolution Professional (IRP) who later became the Resolution Professional (RP) after approval by the Committee of Creditors (CoC).

2. Expression of Interest (EOI) and Resolution Plan Submission:
The RP invited EOIs from prospective resolution applicants, receiving only a few EOIs. Despite extensions granted due to unforeseen circumstances like Covid-19, the prospective resolution applicants failed to submit compliant Resolution Plans.

3. Decision for Liquidation:
The CoC, after multiple meetings, decided to proceed with the liquidation process due to non-compliance of received plans and failure to deposit the required amount. The CoC approved the liquidation resolution through e-voting with a significant majority.

4. Legal Provisions and Precedents:
The judgment cited Section 33 of the Insolvency and Bankruptcy Code, outlining the process for initiating liquidation. It also referenced a legal precedent emphasizing the limited role of the Adjudicating Authority in analyzing commercial decisions of the CoC.

5. Order for Liquidation:
Given the CoC's decision and lack of viable resolution plans, the Tribunal ordered the liquidation of the Corporate Debtor as a going concern. The RP was appointed as the Liquidator, with specific directions regarding the liquidation process, public announcement, cessation of moratorium, and transfer of powers to the Liquidator.

6. Compliance and Further Directions:
The Liquidator was directed to comply with relevant sections of the Code and Liquidation Process Regulations, seek cooperation from personnel connected with the Corporate Debtor, and notify relevant authorities about the liquidation order.

This detailed analysis of the judgment highlights the procedural steps, decision-making process, legal provisions, and the ultimate outcome of the application for liquidation against Neo Corp International Limited under the Insolvency and Bankruptcy Code, 2016.