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Judgment
This is a Company Petition filed by the Liquidator of CCFID Finance Private Limited with CIN: U65929TN2019PTC128313 under Section 59(7) of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as "IBC, 2016") seeking dissolution of the Company.
The Applicant Company was incorporated on 27.03.2019 under the Companies Act, 2013 having its Registered Office at No.15, Kalas Bagar Gunda Street, Vellore – 632 001 with Authorized Capital of Rs.10,00,000/- divided into 10,000 Equity Shares of Rs.100/- each. The main object of the Company is to carry on the business of Micro Finance, as a Non-Banking Finance Company - Micro Financial Institution (NBFC-MFI) for providing collateral-free, micro credit and other permitted financial services to poor men and women, through their Self-Help Groups, in cities, towns and villages of India, with a view to providing them with a sustainable livelihood, above the poverty line, with the overall purpose of creating a professionally-managed, financially-sustainable, community-owned Micro Finance Institution for the poor etc. Details of the main objects of the company are set out in the Memorandum of Association which is filed along with the typed set.
It is stated that Board of Directors in their meeting dated 05.12.2022, passed a Resolution for voluntary liquidation of the company under Section 59 of the IBC that the company is not carrying out any business activities as intended and could not identify any business prospects given that the Net Owned Funds limit for NBFCs was revised by the regulator (RBI) TO Rs.20,00,00,000/-. Since the company was unable to commit on such huge Net Owned Funds, it had no choice but to proceed with Voluntary Liquidation.
It is stated that in the Extra-ordinary General Meeting held on 05.12.2022, shareholders approved to appoint the Applicant to act the Liquidator to conduct the voluntary liquidation process of the Company.
It is submitted that the Applicant has conducted the voluntary liquidation process in respect of the Company in accordance with the compliance of IBBI (Voluntary Process) Regulations, 2017. Details of relevant compliances as mandated under Section 59 of IBC r/w IBBI Regulations, 2017 are as below:
| S.NO | COMPLIANCE | AVERMENTS | PAGE NO. IN THE APPLICATION |
|---|---|---|---|
| 1 | Sec. 59 (3) | Board Meeting dated 05.12.2022 | 68-69 |
| 2 | Sec. 59 (3) | Audited Financial Statements for the Financial Year 2020-2021 and 2021-2022 | 42-67 |
| 3 | Sec 59 (3) (c) And Reg 3 (1)(c) | EGM dated 05.12.2022 | 70-72 |
| 4 | Section 59 (4) and Reg 3 (2) | Declaration of solvency GNL-2 | 32-41 |
| 5 | Section 59 (4) and Reg 3 | Special Resolution for voluntary liquidation vide form MGT-14 | 70-72 |
| 6 | Regulation 14 | Form-A Public Announcement in newspapers dated 07.12.2022 and 08.12.2022 in “Trinity Mirror” (English) & “Makkal Kural” (Tamil) | 180-181 |
| 7 | Section 178 of IT Act, 1961 | Intimation to Income Tax department and other statutory authorities on 14.12.2022 | 212-214 |
| 8 | Reg 9 | Filing of Preliminary Report dated 18.01.2023 | 204-211 |
| 9 | Reg 34 | Opening of Bank Account in the name of the Company followed by the words in liquidation in “ICICI Bank Limited ” | Para 16 of the application |
| 10 | Reg 34 | Closure of liquidation bank account in ICICI Bank Limited | Filed as a Memo vide S.R.No.4480 dated 26.10.2023 at Annexure-1 at Page-3 |
| 11 | Reg 38 | Filing of Final Report dated 30.08.2023 | 233-245 |
| 12 | Reg 38 | Final Report in GNL-2 filed with the ROC dated 31.08.2023 | 257 -259 & 284 |
| 13 | Reg 38 | Submission of Final Report to IBBI on 31.08.2023 | 285 |
| 14 | Reg 38 | Form-H (Compliance Certificate) | 246-256 |
Further, it is stated that after making various payments including liquidation costs as per the provisions of Section 53(1) of IBC, 2016, the Liquidator has distributed the funds among the shareholders as detailed below:
| Sl. No. | Stakeholders' under section 52 and 53 (1) | Amount Claimed | Amount Admitted | Amount Distributed | Amount Distributed to the Amount Claimed (%) | Remarks |
|---|---|---|---|---|---|---|
| 1 | Realization of Security Interest [Sec. 52(1)(b)] | NA | NA | NA | NA | NA |
| 2 | Liquidation Cost [Sec. 53(1)(a)] | 2,25,592 | 2,25,592 | 2,25,592 | 100 | NA |
| 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)] | 12,00,000 | 12,00,000 | 12,00,000 | 100% | NA |
| 6 | Debts of Unsecured Financial Creditors [Sec. 53(1)(d)] | 6,66,100 | 6,66,100 | 6,66,100 | 100% | NA |
| 7 | Government Dues + Amount Unpaid following Enforcement | 12,470 | 12,470 | 13,756 | 108% | Payment Includes Interest of Rs. 1,286. |
| of Security Interest [Sec.53(1)(e)] | ||||||
| 8 | Any remaining Debts and Dues [Sec. 53(1)(f)] | 9,38,200 | 8,20,200 | 8,20,200 | 87.42% | Claim from one of the operational Creditor was partly accepted |
| 9 | Preference Shareholders [Sec. 53(1)(g)] | NA | NA | NA | NA | NA |
| 10 | Equity Share Holders | 5,20,00,000 | 5,20,00,000 | 5,20,00,000 | 100% | Claims of Equity Share Holders |
| 11 | Surplus | NA | NA | 22,53,932 | NA | Surplus Distributed to Equity Share Holder |
| Total | 5,50,42,362 | 5,49,24,362 | 5,71,79,580 |
Note: *If there are sub-categories in a category, please add rows for each sub-category.
Thus on examining the submissions made by the Learned Counsel for the Applicant and after perusing the documents annexed to the application, it appears that the affairs of the Company have been completely wound up and the assets of the Applicant Company have been completely liquidated and as such the Applicant Company deserves to be dissolved. Accordingly, in exercise of the powers conferred under Section 59(8) of the IBC, 2016, we hereby order the dissolution of CCFID Finance Private Limited. The Applicant Company shall stand dissolved from the date of this order. Accordingly, the Company Petition stands allowed.
The Registry and Liquidator are directed to serve a copy of this order upon Registrar of Companies, concerned and also to IBBI within 14 days from the date of this order.