Capedge Consulting Private Limited vs India Techs Limited

This IA has been filed by the Liquidator of India Techs Limited, the Corporate Debtor (CD) seeking following reliefs: -

The Corporate Debtor was admitted to Corporate Insolvency Resolution Process vide order dated 25.10.2019 in Section 9 application by operational creditor, M/s. Capedge Consulting Private Limited and the applicant was then appointed as the RP by the COC. Subsequently, as no resolution plan was received, the CD was admitted to Liquidation vide order dated 05.03.2021. The erstwhile RP was then appointed as the liquidator who carried out public announcement on 16.03.2021 for claims. Accordingly, following claims were received: -

To summarise a total of 11 claims were received including 2 from related parties and no claim from statutory authorities.

The stakeholder’s committee was formed in manner below, was taken into record of this Tribunal on 21.06.2021:

Liquidator has held 8 SCC meetings, the minutes of which has been filed with this Tribunal. The liquidator formed the liquidation estate and has filed 7 quarterly reports and his final report dated 07.10.2022.

It is further submitted that due to an impediment of attachment in an OA proceeding by DRT on assets of CD, and the lockdown imposed due to covid lockdown, the liquidation period was extended along with exclusions till 09.10.2022.

The Liquidator states that the CD has 3 block of realisable asset which is as under

These assets were valued by IBBI registered valuers and the details as per asset memorandum is as below:

Liquidator in consultation with SCC fixed reserve prices accordingly and 3 e-auctions were made and the asset sale report has been filed with the Tribunal. The amounts realised were:

Out of above, an amount of Rs. 541.98 Lakh was distributed as follows:

Further, the entire CIRP Cost amounting to Rs.24,52,578.98 was reimbursed to operational creditor, financial creditor and RP on 24.04.2022. Further, as there were no liquid assets of CD to meet the expenses, the liquidation cost was reimbursed with interest @ 4.25% under the provision of IBC as follows:

The entire fees of the liquidator as fixed by COC in its 10^th meeting and as per schedule of fees under IBBI liquidation regulations amounting to Rs.23,06,640/- and GST was also paid.

It is further stated that as on date of CIRP, the accounts were only available up to 31.03.2015 and the applicant had engaged Chartered Accountant to complete the financials up to 31.03.2020 and conduct audit. The audited financials were filed with the ROC as per IBBI guidelines. It is stated that following assets appeared in latest balance sheet which have been found non realisable and contingent and disputed as on date of this application by the liquidator and the COC.

It is stated that the advance income tax amount and Sales Tax deposit appearing above as asset are disputed by the Income tax department and the sales tax department to which an appeal has been pending before the competent authority and has been stated as a contingent liability.

It is therefore stated that all realisable assets have been sold by e-auction and the entire sale proceeds have been distributed according to section 53 of IBC,2016. Copy of Cash flow statement on liquidation along with liquidation bank statement is furnished by the applicant.

The learned liquidator further stated that there were misstatements of actual stock balances based on physical verification and a forensic audit was conducted wherein following transactions were revealed: -

Subsequently, this Tribunal vide order dated 23.04.2021 ordered to claw back preferential and undervalued transactions amounting to Rs. 393.56 lakh and 967.33 lakh amount in fraudulent transaction. This order is under appeal before Honourable NCLAT, Chennai.

It is stated that the liquidation period has ended and the stakeholders have resolved in its 8^th SCC meeting to contest the proceedings before NCLAT regarding preferential, undervalued and fraudulent transactions. Thus, in terms of regulation 37A and 31A of the IBBI Liquidation regulation, the liquidator has assigned the not readily realisable assets to the 2 secured creditors. The resolution as passed is produced below:

Heard submissions and perused documents on record. In light of the facts stated, it is noticed that the Corporate Debtor does not have assets to be liquidated and hence this Application is moved for the Dissolution of the Corporate Debtor. It is also seen that the liquidator has submitted his final report on CD along with the application detailing all the relevant facts. The assignment of the pending proceedings before NCLAT and its outcomes has also been effected by the liquidator through the resolution passed at the 8th SCC meeting. The suspended management was also represented by learned counsel, who stated his no objection to this application.

Now, for the purpose of pronouncement of Dissolution of a Corporate Debtor, Section 54 of The Insolvency and Bankruptcy Code, 2016 reads as under:-

As a consequence, in view of above, it is hereby declared that not only it is just and equitable but because of the fact that no asset is available for the purpose of ‘Liquidation’ as reported by Learned Liquidator, this is a fit case of a Corporate Debtor to be dissolved as prescribed under Section 54 of The Insolvency and Bankruptcy Code, 2016. Ordered accordingly. The Corporate Debtor stands ‘Dissolved’ from the date of this Order.

Since, the Debtor Company stands Dissolved vide this order, the legal proceedings which are now pending before Hon’ble NCLAT shall be carried out in the manner set forth as per the resolution passed by the SCC at its 8^th meeting filed with this Tribunal.

Copy of this Order shall be forwarded within 7 (seven) days to the concerned authorities and the Registrar of Companies having jurisdiction, for further necessary action as prescribed under Law.

Application is, therefore ALLOWED. Accordingly, TIBA 14/KOB/2019, is hereby disposed of.

The Registry is hereby directed to send e-mail copies of the order forthwith to all the parties and their counsel for information and for taking necessary steps.

Let the certified copy of the order be issued upon compliance with requisite formalities.

File be consigned to records.