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Judgment
This application has been filed under Section 54 of the Insolvency and Bankruptcy Code, 2016 by the liquidator of the Corporate Debtor herein seeking following reliefs:
- a) To pass an order for Dissolving the Corporate Debtor M/s. Rai Ispat Private Limited; and - b) To pass such orders or further order(s) as may deem fit and proper in the facts and circumstances of the case and thus render justice.
It is stated that an application under section 10 of Insolvency and Bankruptcy Code, 2016 was filed by the corporate debtor itself namely., Rai Ispat Private Limited, for initiating Corporate Insolvency Resolution Process(hereinafter referred to as CIRP) against the corporate debtor itself before this tribunal.
It is submitted that Corporate debtor was admitted into CIRP vide order of this Tribunal dated 16.03.2022 in CP/IB/272(CHE)/2021 and Interim Resolution Professional was appointed
It is submitted that, the IRP took the control over the affairs of the corporate debtor pursuant to the order of the Corporate Insolvency Resolution Process. The IRP herein made a public announcement in “Business Standard” and “Malaimalar” on 21.03.2022.
It is submitted that, the Interim Resolution Professional received a claim for a sum of Rs.26,73,22,719.70/- from the sole financial creditor i.e., Shah Coal Private Limited and the same was verified and accepted by the Interim Resolution Professional.
It is submitted that, the Interim Resolution Professional constituted CoC with the sole Financial Creditor namely Shah Coal Private Limited with 100% voting rights.
It is submitted that, a claim was received from one operational creditor namely., Moorgate Industries India Private Limited for a sum of Rs.12,51,80,263/-.
It is submitted that the Interim Resolution Professional conducted the 1st CoC meeting on 16.04.2022, wherein the CoC with 100% voting approved to appoint the IRP as the Resolution Professional of the corporate debtor.
It is submitted that, pursuant to the constitution of CoC, the resolution professional received the claim from another operational creditor namely Tulsyan NEC Limited on 06.06.2022 for a sum of Rs.3,09,78,195.06/- and the same was admitted by the Resolution Professional.
It is submitted that, 2nd CoC meeting was held on 24.06.2022, wherein the CoC accorded to appoint Ms.Subramaniam Aneetha as the Resolution Professional of the Corporate Debtor.
It is submitted that, Financial Creditor vide e-mail dated 08.07.2022 confirmed to withdraw the appointment of the Ms. Subramaniam Aneetha as Resolution Professional.
It is submitted that vide 3rd CoC meeting which held on 01.07.2022., it was resolved for a direct/early dissolution of the corporate debtor. The financial creditor vide email dated 08.07.2022 also confirmed for direct/early dissolution of the corporate debtor.
In pursuant to the approval of CoC for direct/ early dissolution of the corporate debtor, IA(IBC)/1500(CHE)/2022 was filed before this tribunal but the same was withdrawn. The relevant portion is extracted as follows:
ORDER
Ld. Counsel Mr. A.G. Sathyanarayana is present for the Applicant / RP. Ld. Counsel Ms. Palak is present for R1. Ld. Counsel Ms. Harini is present for R2.
Mr. A.G. Sathyanarayana appearing for the Applicant herein has made the following writings in the chat box: "Permit me to withdraw Item NO.201"
Representation is taken on record.
IA(IBC)/1500(CHE)/2022 is withdrawn and disposed off.
Applicant is at liberty to take recourse as per law.
It is submitted that, 4th CoC meeting was held on 18.07.2022. The CoC having financial creditor with 100% voting rights, resolved to liquidate the corporate debtor. The Resolution passed by the CoC is reproduced as follows:
"RESOLVED THAT pursuant to Section 54 of the Insolvency and Bankruptcy Code 2016 and Rule 14 of Insolvency and Bankruptcy Board of India (Liquidation Process) Regulation 2016 the consent of the Committee of Creditors be and is hereby accorded to proceed for liquidation of the Corporate Debtor subject to the necessary approvals from the Adjudicating Authority.
RESOLVED THAT Mr.Asir Raja Selvan shall act as the Liquidator with a remuneration of Rs.1,00,000/- per month till the dissolution of the Corporate Debtor"
It is submitted that, Liquidation order against Corporate Debtor was ordered by this Tribunal on 06.07.2023 in IA(IBC)/650(CHE)/2023 and the applicant herein was appointed as the Liquidator.
It is submitted that in pursuant to the order of Liquidation, the applicant herein made a public announcement in Form B in Business Standard and Makkal Kural on 12.07.2023 for inviting claims from all the stakeholders.
It is submitted that in pursuant to the public announcement, the liquidator received no proper response. It is submitted that there are no assets available for liquidation.
It is submitted that the applicant herein did not appoint any IBBI Registered Valuers or issued Form –G as there were no realisable asset with the corporate debtor.
It is submitted that the liquidation Bank Account in the name of Rai Ispat Private Limited was not opened, as there were no assets or receivables with the corporate debtor.
It is submitted that that vide 4th CoC meeting dated 18.07.2022 it was resolved for direct dissolution of the corporate debtor.
As informed earlier, first the Financial Creditor requested to proceed for Liquidation of the corporate debtor and subsequently advised to proceed for direct dissolution of the corporate debtor which was confirmed by their mail dated 8th July 2022.
“RESOLVED THAT pursuant to Section 54 of the Insolvency and Bankruptcy Code 2016 and Rule 14 of Insolvency And Bankruptcy Board Of India (Liquidation Process) Regulations, 2016 the consent of the Committee of Creditors be and is hereby accorded to proceed for liquidation of the Corporate Debtor subject to the necessary approvals from the Adjudicating Authority for early dissolution.”
“RESOLVED FURTHER THAT Mr. Asir Raja Selvan, shall act as the Liquidator with a remuneration of Rs.1,00,000/- per month till the dissolution of the corporate debtor.”
It is submitted that account closure certificate was not obtained as the liquidation bank account in the corporate debtor was not opened.
It is stated in Form H that no applications are pending before this Tribunal for avoidance, Preferential, Undervalued or Fraudulent Transactions. The extract is as follows:
8.The details of application(s) filed/pending in respect of avoidance of transaction;
| Sl. No. | Type of Transaction | Date of Filing with Adjudicating Authority | Date of Order of the Adjudicating Authority | Brief of the Order |
|---|---|---|---|---|
| (1) | (2) | (3) | (4) | (5) |
| 1 | Preferential transactions under section 43 | Not Applicable | ||
| 2 | Undervalued transactions under section 45 | |||
| 3 | Extortionate credit transactions under section 50 | |||
| 4 | Fraudulent transactions under section 66 |
The details of the relevant compliances as mandated under Section 54 of the IBC, 2016 read with the IBBI (Liquidation Process) Regulations, 2016 are listed hereunder:-
| S. NO | COMPLIANCE | AVERMENTS | PAGE NO. IN THE APPLICATION |
|---|---|---|---|
| 1 | Regulation 12 | Public Announcement in Form B | Page no: 274-275 |
| 2 | Regulation 35(2) | Appointment of Registered Valuers (where no valuation conducted during CIRP) | No values are appointed |
| 3 | Regulation 13 | Preliminary Report | |
| 4 | Regulation 34 | Preparation of Asset Memorandum | No assets are available |
| 5 | Regulation 41 | Opening of Bank Account in the name of the company in Liquidation | Not opened |
| 6 | Regulation 36 | Asset Sale Reports | No assets for realisation |
| 7 | Regulation 45 (3) | Final report | 276-277 |
| 8 | Regulation 37 | Completion of Liquidation Process within one year from Liquidation Commencement Date or extension if any, date of the order and period | Liquidation order passed on 06.07.2023, the application for dissolution filed on 14.012.2023 |
| 9 | Form-H /compliance certificate | 278-281 |
The liquidator has filed the synopsis showing the realisation of assets is as under:
18. REALISATION:
Sl. No. Assets Mode of Sale Estimated Liquidation Value (In Rs.) Realisation amount (In Rs.) Date of Transfer into Liquidation Account (1) (2) (3) (4) (5) (6) 1 NA NA NA NA NA 19. DISTRIBUTION:
(Amount in Rs.)
| Sl. No. | Stakeholders* under Section 52 And 53(1) | Amount Claimed | Amount Admitted | Amount Distributed | Amount Distributed to the Amount Claimed(%) | Remarks |
|---|---|---|---|---|---|---|
| (1) | (2) | (3) | (4) | (5) | (6) | (7) |
| 1 | Realization of Security Interest | NA | NA | NA | NA | NA |
| 2 | Liquidation Cost [Sec.53(1)(a)] | 4,20,000.00 | 4,20,000.00 | 0 | 0 | The Liquidator yet to receive this amount |
| 3 | Workmen's Dues [Sec.53(1)(b)(i)] | NA | NA | NA | NA | NA |
| 4 | Debts of Secured Creditors [Sec.53(1)(b)(ii)] | NA | NA | NA | NA | NA |
| 5 | Wages and Unpaid Dues to Employees [Sec.53(1)(c)] | NA | NA | NA | NA | NA |
| 6 | Debts of Unsecured Financial Creditors [Sec.53(1)(d)] | NA | NA | NA | NA | NA |
| 7 | Government Dues (Both Central & State) [Sec.53(1)(e)] | NA | NA | NA | NA | NA |
| 8 | Any remaining Debts and Dues [Sec.53(1)(f)] | NA | NA | NA | NA | NA |
| 9 | Preference Shareholders [Sec.53(1)(g)] | NA | NA | NA | NA | NA |
| 10 | Equity Shareholders [Sec.53(1)(h)] | NA | NA | NA | NA | NA |
| 11 | CIRP cost | 5,64,992.00 | 5,64,992.00 | 0 | 0 | The Resolution professional yet to receive this amount |
| 12 | Priority payment U/s 36(4)(a)(iii) | NA | NA | NA | NA | NA |
| Total | 9,84,992.00 | 9,84,992.00 | 0 | 0 | NA | |
The Liquidator vide a compliance memo dated 14.02.2025 has stated that the Ex- Directors had paid the entire CIRP cost and Liquidation Cost and there are no outstanding dues.
We have heard Ld. Counsel for the applicant and perused the report and synopsis filed by the Liquidator. The provisions under Insolvency and Bankruptcy Code, 2016 is referred to as follows:
Section 54
“(1)Where the assets of the corporate debtor have been completely liquidated, the liquidator shall make an application to the Adjudicating Authority for the dissolution of such corporate debtor.
(2)The Adjudicating Authority shall on application filed by the liquidator under sub-section (1) order that the corporate debtor shall be dissolved from the date of that order and the corporate debtor shall be dissolved accordingly.
(3)A copy of an order under sub-section (2) shall within seven days from the date of such order, be forwarded to the authority with which the corporate debtor is registered.”
From the averments made in the application along with the perusal of the final report and the Compliance Certificate filed in Form-H by the Applicant, it is seen that the Corporate Debtor has no assets. In the circumstances as averred and as prayed for by the Applicant, an order for dissolution is required to be passed by this Tribunal under Section 54 of the IBC, 2016.
Accordingly, we order for the dissolution of the Corporate Debtor viz., Rai Ispat Private Limited. The Liquidator is directed to forward the copy of this Order to the RoC concerned and also to the IBBI for its records within a period of 7 days from the date of this Order.
In terms of the above, this IA(IBC)/2390(CHE)/2023 stands allowed and disposed of and CP(IB)/272(CHE)/2021 also stands disposed of.
File be consigned to Records.