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Judgment
The present Application is filed by the Resolution Professional under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 (IBC), seeking liquidation of the Corporate Debtor i.e. Versatile Pharma Private Limited.
BRIEF FACTS AS STATED IN THE APPLICATION
The Corporate Insolvency Resolution Process (CIRP) was initiated by this Tribunal vide order dated 24.08.2023 and the Applicant was appointed as Interim Resolution Professional, who was subsequently confirmed as Resolution Professional in the 1st COC meeting held on 04.10.2023.
The Committee of Creditors (CoC) was constituted and comprised primarily of: - Union Bank of India (83.65% voting share) - Canara Bank (16.35% voting share)
It is stated that the Resolution Professional encountered persistent non-cooperation from the suspended management. This Adjudicating Authority, in an application filed under Section 19 of the Insolvency and Bankruptcy Code, 2016, directed the Suspended Director to extend necessary cooperation. However, despite such directions, the requisite financial records and details of the assets were not furnished to the Resolution Professional.
The Applicant at para 6 (page 4-5) of the Application has set out chronology of events relevant to the present application.
Further, it is stated that multiple extensions of CIRP were granted by this Tribunal aggregating to 761 days.
A Resolution Plan was received from M/s Sandor Medicaid's Private Limited and deliberated upon in various CoC meetings. However, the Resolution Applicant failed to comply with key requirements, including clarity on distribution among financial creditors. Further it is stated that material disagreements persisted between the financial creditors regarding charge and distribution.
The Resolution Plan was placed for voting in the 19th CoC meeting. However, the Plan failed to secure the requisite 66% voting share. No member effectively voted in favour of the Plan.
The CoC remained divided as one creditor i.e. Union Bank of India sought deferment pending adjudication before the Appellate Tribunal and the other creditor i.e. Canara Bank pressed for liquidation to prevent erosion of asset value.
In the 20th CoC meeting held on 31.03.2026, the CoC advised the Resolution Professional to seek appropriate directions from this Tribunal, including liquidation.
Despite multiple efforts, including issuance of Form-G, invitation of Expression of Interest, and consideration of a Resolution Plan submitted by a prospective Resolution Applicant, no Resolution Plan could be approved.
FINDINGS AND ANALYSIS
We have carefully considered the submissions made by Mr. M.M. Viswaraj, Ld. Counsel for the Applicant/Resolution Professional and Mr. KMK Prasad, Ld. Resolution Professional and perused the material on record.
We note that the Resolution Plan submitted by M/s Sandor Medicaaids placed before the CoC failed to obtain the statutory voting threshold of 66% and no Resolution Plan has been approved under Section 30(4) of the IBC.
The process has been substantially delayed due to inter se disputes between creditors and owing to non-cooperation of the suspended management. The CIRP period, including all extensions, has expired on 27.03.2026. Further continuation of CIRP is not feasible and would lead to value erosion of the assets of the Corporate Debtor.
In terms of Section 33(1)(a) of the IBC, where no Resolution Plan is approved within the CIRP period, the Adjudicating Authority is required to pass an order of liquidation.
ORDER
In view of the above, this Tribunal hereby orders as follows:
The Corporate Debtor, M/s. Versatile Pharma Private Limited, is ordered to be liquidated in terms of Section 33 of the Insolvency and Bankruptcy Code, 2016.
Ms. Azra Banu, IBBI Regn No. IBBI/IPA-001/IP-P00955/2017-2018/11576, email id. caazra27@gmail.com, #R/o 12-13-377, Street No.2 , Flat 302, Gayatri Garden Apartments, Tarnaka Secunderabad ,Telangana ,500017, Mobile No. 8555058841 is hereby appointed as the Liquidator under Section 34 of the IBC.
The Liquidator shall conduct the liquidation proceedings strictly in accordance with the Code and the IBBI (Liquidation Process) Regulations, 2016, including making public announcement, taking custody of assets, collating claims, and filing periodical reports.
Upon passing of this liquidation order, the moratorium declared under Section 14 shall cease to have its effect.
All powers of the Board of Directors, Key Managerial Personnel and partners of the Corporate Debtor shall cease to have effect and shall be vested in the Liquidator.
All personnel, promoters, and directors of the Corporate Debtor shall extend full cooperation to the Liquidator under Section 19(2) of the Code.
The Liquidator shall be entitled to such fees as may be specified by the Board in terms of Section 34 (8) of the Code.
This order shall be deemed to be a notice of discharge to the Officers, employees and workmen of the Corporate Debtor, except when the business of the Corporate Debtor is continued during the liquidation process by the Liquidator.
The Applicant herein is directed to serve a copy on the Liquidator appointed herein above.
Registry is directed to communicate this order to the Insolvency and Bankruptcy Board of India (IBBI) and to the Registrar of Companies, Telangana.
The Regional Director, Ministry of Corporate Affairs, Registrar of Companies & Official Liquidator, Hyderabad, the Registered Office of the Corporate Debtor and the Liquidator.