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2021 (10) TMI 710 - Tri - Insolvency and BankruptcyLiquidation of the Corporate Debtor - Section 33(2) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - The liquidation has to follow as recommended by the Committee of Creditors in terms of provisions of Section 33(2) of the Code. Adherence to statutory requirement has to be in toto. When the language of the Code is clear and explicit the Adjudicating Authority must give effect to it whatever may be the consequences and in present case the consequence is liquidation of Corporate Debtor. Since there is no resolution plan, and in conformity with the decision of the Committee of Creditors with 100% voting share, the payer for liquidation of the corporate debtor under Section 33 of the Code is hereby allowed. Application allowed.
Issues:
- Application for liquidation of Corporate Debtor under Section 33(2) of the Insolvency and Bankruptcy Code, 2016. - Approval of Resolution for Liquidation by Committee of Creditors with 100% voting share. - Appointment of Liquidator and issuance of Public Announcement. - Directions for the liquidation process and compliance with statutory requirements. Analysis: 1. The application before the National Company Law Tribunal pertains to the liquidation of a Corporate Debtor, Advance Home and Personal Care Private Limited, under Section 33(2) of the Insolvency and Bankruptcy Code, 2016. The Resolution Professional filed the application seeking directions for the liquidation process. 2. The background reveals that the Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor upon the application filed by an operational creditor. The Interim Resolution Professional was appointed, and subsequent meetings of the Committee of Creditors (CoC) were held to discuss matters related to the CIRP. 3. Despite efforts to solicit resolution plans through Invitations for Expression of Interest, no viable plans were received from Prospective Resolution Applicants (PRAs). The CoC authorized the applicant to seek an extension of the CIRP period, but ultimately, no resolution plan was submitted within the stipulated timeline. 4. Consequently, the CoC, with 100% voting share, approved the resolution for the liquidation of the Corporate Debtor in a meeting and fixed the fee of the liquidator. The Resolution Professional then filed the present application for the liquidation of the Corporate Debtor based on the CoC's decision. 5. The Tribunal emphasized the importance of adhering to statutory requirements and following the provisions of the Insolvency and Bankruptcy Code. Given the absence of a resolution plan and the CoC's decision, the Tribunal allowed the prayer for liquidation under Section 33 of the Code. 6. The Tribunal granted the application, ordering the liquidation of the Corporate Debtor and appointing the Resolution Professional as the Liquidator. Various directions were issued regarding the commencement of the liquidation process, including the issuance of a Public Announcement, communication with relevant authorities, and the submission of reports as per regulations. 7. The Tribunal disposed of the application in favor of liquidation, directing the Liquidator to proceed with the liquidation process in accordance with the Code and relevant regulations. The Order of Moratorium was to cease, and a fresh Moratorium under Section 33(5) of the Code was to commence, ensuring the orderly conduct of the liquidation proceedings.
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