Bank Of India vs M/s. ECI Infra Towers Company Private Limited

Orders pronounced. In the result, this company is dissolved. Since the company is dissolved the files may be consigned to records.

PER: BENCH

This Application is filed by the Liquidator of M/s ECI Infra Towers Company Private Limited/Corporate Debtor under Section 54(1) of Insolvency & Bankruptcy Code (IBC) seeking dissolution of the Corporate Debtor.

To put concisely, this Tribunal vide its Order in IA (IBC)/197/2022 in CP (IB) No. 673/7/HDB/2019 dated, 28^th February, 2023, had ordered liquidation of the Corporate Debtor and appointed Ms. Kalpana G, (the Applicant herein) as the Liquidator of the Company to conduct the Liquidation Process.

Brief overview of the liquidation process conducted by the Applicant / Liquidator: -

The Liquidator submits that the Corporate Debtor has following assets, which are held as security by the United Bank of India for the loans advanced to the Corporate Debtor, which was subsequently assigned to M/s Omkara Asset Reconstruction Private Limited through Assignment deed and by virtue of the said assignment M/s Omkara Asset Reconstruction Private Limited is one of the Secured Financial creditors of the CD having first charge over the assets of the CD.

a. Plant and Machinery on the lease hold land admeasuring A 11.37 guntas in Sy.No. 332/A, 3/1A, 3/1B, 5 and A 10.27 guntas in Sy.No. 332/A, 333.A,8B, 8A, 7, in total A 22.24 guntas, situated at Kaveli Village, Kohir Mandal, Sangareddy District (erstwhile Medak District), Buildings, Structures there upon and stocks.

The Liquidator submitted that the Secured Financial creditor has not relinquished the security interest to the liquidation estate and sold the secured assets through SARFAESI proceedings without following the due process contemplated u/s 52 of IBC, 2016. Aggrieved by the said action of the secured financial creditor, the liquidator filed IA 1753/2023, praying to set aside the sale conducted by the said creditor. This Tribunal on 10.06.2024 vide order passed in IA 1753/2023 directed M/s Omkara Asset Reconstruction Private Limited/Secured Creditor to comply with Regulation 21A(2) and make payment of the insolvency resolution process costs and the liquidation costs in full. Relevant portion of the order is reproduced below:-

Complying the above order of this Tribunal, the secured financial creditor has paid the total CIRP expenses and liquidation expenses to the liquidation account.

The Liquidator submitted that the Liquidation period of 1 year as per Liquidation process Regulations completed on 28-02-2024. However, in order to facilitate the Liquidator to complete the pending activities, this Tribunal granted extension of liquidation period as under:-

In the light of above facts and circumstances of the case, the only point that emerges for consideration of the Tribunal is

We heard Ms. Mumanneni Vazra Laxmi, Ld. Counsel for the Liquidator and perused the record.

At the outset it may be stated that Section 54 of the IBC lays down the criteria for dissolution of the Corporate Debtor.

Regulation 45 of Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016 reads as under:-

According to the Liquidator, the assets of the Corporate Debtor are secured and the secured financial creditor has not relinquished the security interest to the liquidation estate and sold it through SARFAESI proceedings. Further as per directions of this Tribunal, the secured financial creditor has cleared the total CIRP and liquidation expenses.

It is recorded in the final report of the Liquidator that in case there is any realization from the debtors of the Company and the Statutory Authorities against refunds, the same shall be adjusted towards the claims of the stakeholders in order of priority as laid down in Section 53 of the Code. It is further recorded that promoters/Directors shall be liable for the pending assessments as well as assessments arising subsequent to dissolution of the Company, to the extent they are liable as per provisions of the law.

The Liquidator submitted that it was decided in the 1^st SCC meeting held on 09.03.2023 to use the same valuation reports available in the CIRP process instead of appointing registered valuers once again in liquidation. As per Form-H, the fair and liquidation values are Rs. 3.57 crores and Rs. 2.67 crores respectively.

The Liquidator is of the opinion that when there is nothing left to recover or realize, then it is a futile exercise to continue with the Liquidation Proceedings. Hence prayed this Tribunal to order dissolution of the Corporate Debtor Company.

We are satisfied that the criteria laid down under law has been fully complied with. As such, the Corporate Debtor is liable to be dissolved. Hence, we hereby order dissolution of the Corporate Debtor as under: -

The Corporate Debtor/ECI INFRA TOWERS COMPANY PRIVATE LIMITED stands dissolved from the date of this Order, in terms of Section 54(1) of IBC, 2016, and the Liquidator stands relieved.

The Liquidator is directed to send the copy of this Order within 7 days from the date of pronouncement to the Registrar of Companies, Hyderabad.

Upon dissolution of the Corporate Debtor, the records of the Company which are in possession of the Liquidator, will be retained both in physical as well as electronic form as per Regulation 39A of the CIRP Regulations

The Registry is also directed to communicate this order to the Registrar of Companies, Hyderabad for updating the master data.

A copy of this order be also forwarded to the Insolvency & Bankruptcy Board of India, New Delhi.

In terms of the above, IA (Diss) No. 14 of 2024 filed by the Liquidator appointed for ECI INFRA TOWERS COMPANY PRIVATE LIMITED (Corporate Debtor) for dissolution of the Company under Section 54 (1) of IBC, 2016 stands disposed of accordingly. Since the Corporate Debtor stood dissolved vide this order and no proceedings are now pending, therefore, the Registry is directed to consign the file to records.