2021 (11) TMI 790 - Tri - Insolvency and Bankruptcy

Seeking liquidation of Corporate Debtor - Section 33(1) of IBC - HELD THAT - It is seen that in the 11th CoC meeting held on 26.05.2021, the CoC with majority of 100% voting rights approved to apply before the Adjudicating Authority for liquidation of the Corporate Debtor under section 33 (2) of the IBC. It is permitted to initiate liquidation process against the Corporate Debtor - moratorium ceased to exist - application allowed.

Summary

Issues Involved:
Liquidation process initiation against the Corporate Debtor under Section 33(2) of IBC.

Detailed Analysis:
1. The Interlocutory Application was filed under Section 33(1) of IBC, 2016 by the Resolution Professional seeking liquidation of the Corporate Debtor and appointment of the Resolution Professional as the Liquidator.
2. The Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor was initiated earlier, and various meetings were held to invite Expression of Interest (EOI) from Prospective Resolution Applicants (PRAs).
3. Despite multiple extensions and opportunities given to PRAs, including the Promoter, to submit a Resolution Plan, none of them submitted the plan within the specified timelines.
4. The Committee of Creditors (CoC) eventually decided to initiate the liquidation process due to the failure of PRAs to submit Resolution Plans.
5. The Tribunal directed the Resolution Professional to submit financial statements of the Corporate Debtor for specified financial years and verified the credentials of the proposed Liquidator.
6. Based on the resolution passed by the CoC, the Tribunal allowed the initiation of the liquidation process against the Corporate Debtor under Section 33(2) of IBC.
7. The Tribunal appointed the Resolution Professional as the Liquidator and outlined the procedures for liquidation, including public notices, cessation of powers of the Board of Directors, and cooperation from the Corporate Debtor's personnel.
8. Legal proceedings against the Corporate Debtor were restricted, and the Liquidator was granted necessary powers to manage the liquidation process effectively.
9. The liquidation order was deemed a discharge notice for the Corporate Debtor's officers, employees, and workmen, except for continued business operations during liquidation.
10. The Registry was instructed to forward the order to relevant parties, and the moratorium declared earlier was lifted.

This comprehensive analysis covers the key aspects and outcomes of the judgment delivered by the National Company Law Tribunal, Kochi Bench, regarding the initiation of the liquidation process against the Corporate Debtor.