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2021 (9) TMI 745 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT - The Resolution Professional, having not succeeded in getting any Resolution Plan for the revival of the Corporate Debtor, the Adjudicating Authority has no other alternative but to pass an Order, requiring the Corporate Debtor to be liquidated in the manner as laid down in Chapter-III, Section 33 of the Insolvency Bankruptcy Code, 2016. Further, the Corporate Debtor, Mohan Motors Distributors Private Limited, is also not a going concern, with no employees, and huge accumulated losses - Since there is no other option other than to pass an Order for liquidation of the Corporate Debtor, we are inclined to invoke Section 33 of Chapter-III of the Insolvency Bankruptcy Code, 2016, ordering liquidation of the Corporate Debtor, namely, Mohan Motors Distributors Private Limited, as laid down in this Chapter. The Corporate Debtor is ordered to be liquidated - Application allowed.
Issues:
1. Initiation of Corporate Insolvency Resolution Process under Section 9 of the Insolvency & Bankruptcy Code, 2016. 2. Appointment of Resolution Professional and subsequent replacement. 3. Decision to liquidate the Corporate Debtor due to absence of Resolution Plan. 4. Appointment of Resolution Professional as Liquidator. 5. Orders related to liquidation process and moratorium. Issue 1: Initiation of Corporate Insolvency Resolution Process The case involved Aircom Travels Private Limited, the Operational Creditor, filing a Petition under Section 9 of the Insolvency & Bankruptcy Code, 2016 against Mohan Motor Distributors Pvt. Ltd., the Corporate Debtor. The Adjudicating Authority admitted the Petition, appointing an Interim Resolution Professional initially. Issue 2: Appointment of Resolution Professional After the appointment of the Interim Resolution Professional, Mr. Sandip Kumar Kejriwal, the Committee of Creditors later resolved to replace him with Mr. Kamal Agarwal as the Resolution Professional in a meeting held on 20th August, 2020. This decision was made due to the absence of any Resolution Plan despite efforts by prospective Resolution Applicants. Issue 3: Decision to Liquidate Corporate Debtor With no Resolution Plan forthcoming and the extended period for Corporate Insolvency Resolution Process (CIRP) set to expire, the Committee of Creditors, with majority voting shares, decided in a meeting on 10th April, 2021, to liquidate the Corporate Debtor. The decision included appointing the Resolution Professional, Mr. Kamal Agarwal, as the Liquidator, in accordance with the relevant regulations. Issue 4: Appointment of Resolution Professional as Liquidator The Resolution Professional, having failed to secure a Resolution Plan for the revival of the Corporate Debtor, led to the Adjudicating Authority ordering the liquidation of the Corporate Debtor as per Chapter-III, Section 33 of the Insolvency & Bankruptcy Code, 2016. Mr. Kamal Agarwal was appointed as the Liquidator with specific directives regarding the liquidation process. Issue 5: Orders related to liquidation process and moratorium The Order for liquidation included various directives such as the issuance of a Public Announcement, cessation of the moratorium under Section 14, and initiation of a fresh moratorium under Section 33(5). The Liquidator was instructed to proceed with the liquidation process as per the Code's provisions, and the Registry was directed to inform relevant authorities about the Order. In conclusion, the Tribunal allowed the Application filed by Mr. Kamal Agarwal, RP of Mohan Motor Distributors Pvt. Ltd., ordering the liquidation of the Corporate Debtor and issuing specific directives for the process, including the appointment of Mr. Agarwal as the Liquidator and communication of the Order to relevant authorities.
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