2021 (10) TMI 817 - Tri - Insolvency and Bankruptcy

Dissolution of the Corporate Person - voluntary liquidation - Section 59(7) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - There are no assets in the Corporate Person, which is shown in the bank statement of the Corporate Person. On the Petition filed by the Liquidator under sub-section 7 of Section 59 of the Code for dissolution of this Corporate Person, it is noticed that the affairs of the Corporate Person have been completely wound up and its assets are liquidated. This Corporate Person, through its Liquidator, voluntarily liquidated itself so as to get dissolved, therefore, this Corporate Person is dissolved directing the Liquidator to file this order with concerned Registrar of Companies and IBBI within 14 days thereof. Petition allowed.

Issues:
1. Company petition filed for dissolution under Section 59(7) of the Insolvency and Bankruptcy Code, 2016.
2. Compliance with formalities and procedure of liquidation.
3. Background and structure of the Corporate Person.
4. Decision of the Board of Directors to liquidate the company.
5. Submission of financial statements and balance sheets.
6. Passing of Special Resolution for liquidation.
7. Notification to regulatory authorities and stakeholders.
8. Opening and closing of a bank account for liquidation.
9. Submission of preliminary and final reports by the Liquidator.
10. Dissolution of the Corporate Person.

Analysis:

1. The Company Petition was filed under Section 59(7) of the Insolvency and Bankruptcy Code, 2016, by a Corporate Person, Vidarbha Tannaries Private Limited, through the Insolvency Professional, Mr. Anand Daga, for voluntary liquidation and dissolution of the Corporate Person. The Corporate Person completed all necessary formalities and procedures in compliance with the law to file the petition for dissolution.

2. The Corporate Person, a Public Limited Company and Government Company, was incorporated under the Companies Act, 1956, with specific share capital details. The Corporate Person, being a subsidiary of a Maharashtra Government Company, had faced scrutiny from the Comptroller & Auditor General of India for incurring avoidable expenses due to inactivity. Subsequently, a Voluntary Liquidator, Mr. Anand Daga, was appointed by the Maharashtra Government for the voluntary liquidation process.

3. The Corporate Person's registered office was located in Nagpur, and the Board of Directors decided to liquidate the company voluntarily after confirming the absence of debts and any intent to defraud. Declarations of solvency and financial statements were filed as required under the Code.

4. The members of the Corporate Person passed a Special Resolution in an Extra-Ordinary General Meeting to appoint Mr. Anand Daga as the Liquidator for the voluntary liquidation process. Since the Corporate Person had no creditors, the approval of creditors for the Special Resolution was not necessary.

5. The Liquidator fulfilled all notification requirements by informing the Registrar of Companies, IBBI, and the Income-tax Department about the liquidation process. Public announcements were made to stakeholders, and a bank account was opened and closed as part of the liquidation process.

6. The Liquidator submitted preliminary and final reports to the IBBI, along with audited accounts of liquidation. It was confirmed that the Corporate Person had no assets, and the liquidation process was completed, leading to the filing of the final dissolution petition, which was allowed by the Tribunal.

7. The Tribunal dissolved the Corporate Person, directing the Liquidator to file the order with the Registrar of Companies and IBBI within the specified timeframe, thereby concluding the voluntary liquidation and dissolution process in compliance with the relevant provisions of the Insolvency and Bankruptcy Code.

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