AI Structured Summary
Not yet generated for this judgment
Judgment
PER: SHRI RATAKONDA MURALI MEMBER (JUDICIAL)
This IA is filed by Resolution Professional of M/s Claps Wikids Education Private Limited under Section 33(1) (a) of the Insolvency & Bankruptcy Code, seeking for liquidating the Corporate Debtor M/s. Claps Wikids Education Private Limited and further to appoint the Resolution Professional/ Applicant herein to act as Liquidator.
This Tribunal vide orders passed on 03.12.2018 admitted the Petition filed by M/s Cyberabad Hitech Integrated Township Development Corporation Pvt Limited / Financial Creditor under Section 7 of Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process against M/s Claps Wikids Education Private Limited / Corporate Debtor and appointed Shri C.A. Kiran Palla as Interim Resolution Professional, who was subsequently confirmed as Resolution Professional.
Pursuant to on taking over charge as Interim Resolution Professional, the Applicant herein caused public announcement inviting claims. A list of Committee of Creditors was formed as required under Regulation 17 of Insolvency Resolution Process for Corporate Persons Regulations, 2016 after collating the claims received / admitted. The Financial Creditor in the main petition is the sole member of CoC.
Though Interim Resolution Professional conducted the 1st Committee of Creditors meeting on time, yet he could not file the report certifying the constitution of CoC on time and thus requesting this Tribunal to condone the delay.
It is the case of Resolution Professional that the Corporate Debtor is running and maintaining Play School for infants and kids. As the Corporate Debtor defaulted in filing annual returns its name was struck off from the register of RoC (Hyderabad) as on the date of commencement of CIRP. The Corporate Debtor is not carrying out any operations since last 6 months. Further Directors (Suspended Board) are also not interested in continuing the Company.
Only assets worth between Rs. 50,000/- to Rs. 1,00,000/- is only available in the Company. It is also the case of Resolution Professional that the Directors (Suspended Board) of Corporate Debtor never maintained any ledgers, cash books etc. Further bank balance in the account maintained with ICICI Bank is nil. It is also the case of Resolution Professional that a second school is also being run as a society and the CIRP proceedings could not extend to the same as it is under different entity with some promoters in common. Further CoC in its (1^{\text{st}}) meeting held on 02.01.2019 approved for liquidating the Company. The Applicant herein also requested the Tribunal to appoint him as a liquidator under Sec 33(2) of the IBC, 2016.
We heard the Resolution Professional. The Present Application is filed by the Resolution Professional under Section 60(5) of the Code seeking initiation of liquidation process of M/s. Claps Wikids Education Private Limited (Corporate Debtor).
The Resolution Professional informed the Tribunal that in the (1^{\text{st}}) CoC meeting held on 02.01.2019, the sole member of CoC who is the Financial Creditor / Petitioner in the main petition approved for liquidating the Corporate Debtor Company. As on the date of commencement of CIRP, the name of the Corporate Debtor Company was struck off from the register of Companies which was restored vide orders passed vide by this Tribunal on 19.08.2019. Hence, the CoC passed a resolution for liquidating the Corporate Debtor Company.
Section 33 of Insolvency and Bankruptcy Code, 2016 read as follows:
(1)Where the Adjudicating Authority, —
(a)before the expiry of the insolvency resolution process period or the maximum period permitted for completion of the corporate insolvency resolution process under section 12 or the fast track corporate insolvency resolution process under section 56, as the case may be, does not receive a resolution plan under sub-section (6) of section 30; or
(b)rejects the resolution plan under section 31 for the non-compliance of the requirements specified therein, it shall—
(i)pass an order requiring the corporate debtor to be liquidated in the manner as laid down in this Chapter;
(ii)issue a public announcement stating that the corporate debtor is in liquidation; and
(iii)require such order to be sent to the authority with which the corporate debtor is registered.
As per Section 33(1) (a) of the Code, if the Resolution Plan has not received under Section 30(6) with in CIRP period, the Tribunal has no other option but to pass a liquidation order. The Resolution Professional has not filed any Resolution Plan before this Tribunal under Section 30(6) with in CIRP period. By relying on Section 33(1) (a) of the Code, the Resolution Professional having not submitted any Resolution Plan within CIRP period leads to passing an order of liquidation. We see no other alternative except passing an order of liquidation requiring the Corporate Debtor/ Claps Wiki Education Private Limited to be liquidated in the manner laid down in Chapter 3 of Part 2 of the Insolvency and Bankruptcy Code, 2016.
As per Section 34(1) of the Code after passing the order of liquidation of corporate Debtor, the Resolution Professional appointed for CIRP Process shall act as Liquidator for conducting Liquidation Process. Accordingly Mr. C.A. Kiran Palla having Registration No. IBBI/IPA-001/IP-P00355/2017-18/10613 is appointed as the Liquidator. The Resolution Professional has given his consent for appointing him as a liquidator.
ORDER
In the result, the Application is allowed and Corporate Debtor M/s Claps Wikids Education Private Limited is ordered to be liquidated.
The Liquidator is directed to proceed with the process of liquidation in manner laid down in Chapter III of Part 2 of the Insolvency and Bankruptcy Code, 2016 by following the liquidation process given in IBBI (Liquidation Process) Regulations, 2016.
All powers of the Board of Directors, key managerial personnel and the partners of the Corporate Debtor, as the case may be, shall cease to have effect and shall be vested in the Liquidator.
The Liquidator is directed to issue Public Announcement stating that the Corporate Debtor is in liquidation, in terms of Regulation 12 of the IBBI (Liquidation Process) Regulations, 2016.
The Order of Moratorium passed under Section 14 of the Code shall cease to have its effect.
This order is deemed to be a notice of discharge to the officers, employees and the workmen of the Corporate Debtor as per Section 33(7) of the Code.
Since Liquidation order has been passed no suit or other legal proceedings shall be instituted by or against the Corporate Debtor, save and except as mentioned in Section 52 of the Code, as to institution of legal proceedings by the Liquidator, he is at liberty to initiate suit or legal proceedings with prior approval of this Adjudicating Authority, but this direction shall not apply to legal proceedings in relation to such transactions as may be notified by the Central Government in consultation with any financial sector regulator.
We hereby direct that the fee shall be paid to the Liquidator as envisaged under Regulation 4 of IBBI (Liquidation process) Regulations, which forms part of the liquidation cost.
The Liquidator shall submit a Preliminary Report within 75 days from the Liquidation Commencement date as per Regulation 13 of the IBBI (Liquidation Process) Regulations, 2016.
The Application is disposed of accordingly.