2022 (1) TMI 1181 - Tri - Insolvency and Bankruptcy

Seeking Liquidation of Corporate Debtor - no resolution plan has been received by him in spite of publication of Form 'G' - HELD THAT - Vide order dated 25/02/2020 this Adjudicating Authority has extended the CIRP period by 90 days from 25/02/2020. Vide order dated 26/03/2021 passed in IA/176(KB)2021, this Adjudicating Authority excluded 369 days from the CIRP period and further extended the CIRP period by 60 days thereby the CIRP period came to an end on 28/07/2021 - It appears that the last available Balance Sheet on the MCA Portal was only up to 2013-14. The RP has filed an application being IA (IB) No. 315 (KB) 2021 under sections 43, 45 and 66 for preferential, undervalued and fraudulent transactions. The Resolution Professional has given his consent to act as the Liquidator of the Corporate Debtor and has annexed with the application as Annexure - 5 . Section 33(1)(a) of the Code mandates that the Adjudicating Authority shall pass an order of liquidation where no resolution plan is received before the expiry of the CIRP. Sub-section (2) thereof requires the Adjudicating Authority to pass the liquidation order where the Resolution Professional intimates to the Adjudicating Authority the decision of the Committee of Creditors approved by not less than 66% of the voting share to liquidate the Corporate Debtor. Reading these two provisions together, this Adjudicating Authority is left with no option but to order liquidation of the Corporate Debtor. The Corporate Debtor is ordered to be liquidated - application allowed.

Summary

Issues: Liquidation of Corporate Debtor

1. Background and CIRP Proceedings:
The Tribunal received an application from the Resolution Professional of the Corporate Debtor, stating no resolution plan was received despite due process. The Corporate Debtor underwent CIRP, initiated by an order dated 29/08/2019, with the appointment of an Interim Resolution Professional. The Resolution Professional was confirmed at the first CoC meeting, and public announcements were made inviting claims and forming the CoC. Despite extensions, no resolution plan was received.

2. Preferential, Undervalued, and Fraudulent Transactions:
The RP filed an application under sections 43, 45, and 66 for preferential, undervalued, and fraudulent transactions, noting discrepancies in the available Balance Sheet on the MCA Portal.

3. Liquidation Order:
As per Section 33(1)(a) and (2) of the Code, the Adjudicating Authority is mandated to order liquidation if no resolution plan is received or if the CoC decides to liquidate. The Tribunal, after considering the provisions, ordered the liquidation of the Corporate Debtor.

4. Order Details:
The Tribunal's order included appointing the RP as the Liquidator, initiating the liquidation process, issuing public notices, transferring powers to the Liquidator, and directing cooperation from the Corporate Debtor's personnel. Legal proceedings against the Corporate Debtor were restricted, and the order was deemed a discharge notice for officers except during continued business. Filing requirements with the Registrar of Companies were specified.

5. Disposal of Application and Future Reporting:
The Tribunal disposed of the application, set a date for periodical reporting, informed the IBBI, and directed the Registry to share the order with involved parties. Certified copies were to be issued upon formalities' completion.

This comprehensive analysis covers the Tribunal's decision regarding the liquidation of the Corporate Debtor, detailing the procedural history, reasons for liquidation, specific application filings, order specifics, and post-order instructions and notifications.