D. K. Jain Properties Private Limited vs M/s. Saraswati Sales Private Limited

Per: Rohit Kapoor, Member (Judicial)

This Adjudicating Authority convened through hybrid mode.

IA(IBC)/1351(KB)2023 is an application filed under section 54 of the Insolvency and Bankruptcy Code, 2016 (hereinafter called the “Code”) read with regulation 45 of the IBBI (Liquidation Process) Regulations, 2016 (hereinafter called the “Regulations 2016”) by the Liquidator of M/s. Saraswati Sales Private Limited (hereinafter called the “Corporate Debtor”) praying for dissolution of the Corporate Debtor. This application is duly supported by an affidavit^{11.At pages 21 and 22 of the application} affirmed by Mr. Shashi Agarwal, the Liquidator.

This Adjudicating Authority vide its order^{22.Annexure “A” at pages 23 to 33 of the application} dated 24/06/2019 on a Petition filed by D. K. Jain Properties Private Limited. (Financial Creditor) under section 7 of the Code read with rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 directed initiation of the Corporate Insolvency Resolution Process (hereinafter called the “CIRP”) against M/s. Saraswati Sales Private Limited (Corporate Debtor) appointing Mr. Shasi Agarwal, an Insolvency Professional as Interim Resolution Professional (hereinafter called the “IRP”). Liquidation order^{33.Annexure “B” at pages 34 to 39 of the application} was passed on 07/11/2019 appointing Mr. Shashi Agarwal, the applicant, as the Liquidator.

In compliance of regulation 12 of Regulations 2016, Public Announcement^{44.Annexure “D” at pages 55 to 56 of the application} of commencement of liquidation process was made in Form – B in “Financial Express” (English) and “Aajkal” (Bengali) on 09/11/2021 inviting submission of claims from the stakeholders of the Corporate Debtor. Accordingly, the Liquidator received the following claims from the stakeholders of the Corporate Debtor: -

In Compliance of regulations 31(2) of Regulations, 2016, the Liquidator had submitted List of Stakeholders^{55.Annexure “E” at pages 57 to 69 of the application} with this Adjudicating Authority. In terms of regulation 31A of Regulations 2016, the Liquidator had constituted Stakeholders’ Consultation Committee^{66.Annexure “G” at pages 87 to 102 of the application} (hereinafter called “SCC”) and submitted the same with this Adjudicating Authority. As there was no functional website of the Corporate Debtor, the List of Stakeholders with details of the number of claims received along with no of claims admitted/rejected by the Liquidator, was uploaded on the Website of IBBI^{77.Averments in paragraph 16 at page 15 of the application}. The Liquidator had also annexed with this application List of Stakeholders^{88.Annexure “H” at page 103 of the application} constituted before amendment and after the amendment of Regulations 2016.

It is stated by the Liquidator in the application that the Liquidator did not appoint any Valuer during the liquidation period as the Corporate Debtor had only fixed deposits as assets and during the CIRP period valuation reports with regard to Fair Value and Liquidation Value were duly prepared by IBBI approved Valuers. Copies of those valuation reports^{99.Annexure “C” at pages 40 to 54 of the application} form Annexure “C” to this application. The average Fair Value and Liquidation Value are Rs.7,56,786/- and Rs.6,46,581/-respectively.

In compliance of regulations 13 and 34 of Regulations 2016, the Liquidator had duly prepared and filed with this Adjudicating Authority Preliminary Report and Asset Memorandum^{1010.Annexure “F” at pages 70 to 86 of the application} respectively.

As per regulation 41 of the Regulations 2016, the Liquidator had duly opened a liquidation account being A/c. No. 000605034302 in the name of “Saraswati Sales Private Limited- in Liquidation” with the ICICI Bank, R. N. Mukherjee Road Branch, 20, R. N. Mukherjee Road, Kolkata^{1111.Compliance Certificate (Form H) at pages 233 and 234 of the application}.

As per provisions of the Code and Regulations the Liquidator had duly intimated to Statutory Authorities^{1212.Compliance Certificate (Form H) at page 236 of the application}, as applicable, as follows: -

It is stated in the application by the Liquidator that the Corporate Debtor had no valuable assets in comparison to the claim received during the liquidation period. Based on the audited accounts and numbers of claims received, the Applicant as the Resolution Professional never had the impression and/or opinion that transaction audit for preferential or fraudulent was necessary^{1313.Averments in para 18 at page 15 of the application.}. A copy of audited Balance Sheet^{1414.Annexure “I” at pages 104 to 116 of the application} for the year ended 31/03/2019 forms Annexure I. However, during the liquidation period based on the numbers of claims received, the Liquidator formed an opinion that there might be some transaction prejudicial to the interest of the creditors. Hence, Transaction Auditor was appointed during the liquidation period on 14/01/2021. Accordingly, report from the Transactional Auditor was received on 26/03/2022.¹⁵

It is stated in the application by the Liquidator that in compliance of regulation 45 of Regulations 2016, Form H was prepared. The average liquidation value of the Corporate Debtor is Rs.6,46,581/- whereas the total realised amount from the financial assets of the Corporate Debtor is Rs.6,86,029/-. Since the CIRP costs and Liquidation cost is more than the amount realised from Financial Assets of the

¹⁵ Averments in para 19 at page 16 of the application. Corporate Debtor, no amount was left with the Liquidator for distribution among the stakeholders as per section 53 of the Code. However, the deficit amount towards the Liquidation Cost was contributed by the Financial Creditor^{1616.Averments in paragraph 20 at page 16 of the application}.

After taking into consideration of exclusion and extension the liquidation period had ended on 30/07/2022. Copy of the extension order^{1717.Annexure “J” at pages 117 and 118 of the application} dated 31/01/2022 forms Annexure “J”.

It is further stated that the Bank Account of the Corporate Debtor was debit frozen by the bank officials in terms of the order received from the Office of the Assistant Collector wherein it was directed to mark lien on the account which was informed to the Liquidator by the Bank on 03/12/2022. Accordingly, in order to remove lien an application being IA(IBC)/433(KB)2023 was filed which came up for hearing on 17/04/2023. A copy of the order^{1818.Annexure “K” at pages 119and 122 of the application} dated 17/04/2023 forms Annexure “K”. However, the said account was de-frozen by the Bank on 06/05/2023 upon receiving a communication from the Office of the Assistant Collector directing the Bank to remove the lien from the aforesaid bank account. Hence, the said IA(IBC)/433(KB)2023 was dismissed on 16/05/2023 as infructuous. A copy of the said order^{1919.Annexure “L” at pages 123 of the application} dated 16/05/2023 forms Annexure “L”.

In compliance of section 35(2) of the Code, the Liquidator during the liquidation period hold ten SCC meetings, copies of the minutes of all the ten SCC meetings^{2020.Annexure “M” at pages 124 to 172 of the application} form Annexure ‘M’

The SCC at its 10^th meeting held on 06/01/2023 has unanimously decided to dissolve the affairs of the Corporate Debtor. Copy of the minutes of 10^th SCC meeting^{2121.Annexure “N” at pages 173 to 177 of the application} forms Annexure ‘N’.

In compliance of regulation 15 of the Regulations 2016, the Liquidator had altogether filed Fifteen Periodical Progress Reports from time to time before this Adjudicating Authority.

As per Form H submitted by the Liquidator, no application u/s. 43, 45, 50 and 66 has been preferred/pending with this Adjudicating Authority.^{2222.Para 9 of Form H at page 241 of the application}

In compliance of regulation 45 of the Regulations 2016, the Liquidator has filed the Final Report^{2323.Annexure “O” at pages 178 to 232 of the application} annexing the following documents: -

27/05/2023

In terms of regulation 45 of the Regulations 2016, the Liquidator has also filed Compliance Certificate in Form H^{2424.Annexure “P” at pages 233 to 241 of the application} as well as copy of Bank Statement^{2525.Annexure “Q” at pages 242 to 246 of the application} showing “zero” balance in the liquidation account.

It is submitted by the Ld. Counsel for the Liquidator that the Corporate Debtor has only financial assets, which has been realised and the SCC at its 10^th meeting unanimously decided for dissolution of the Corporate Debtor.

It is also submitted by the Ld. Counsel for the Liquidator that the affairs of the Corporate Debtor were completely liquidated after realising the assets.

Upon hearing the Ld. Counsel appearing for the Liquidator and perusing the documents annexed to the application, it appears that affairs of the Corporate Debtor have been completely wound up and its assets have been completely liquidated. The bank account has also been closed.

In view of the facts and circumstances stated above, there is no impediment to the Corporate Debtor being dissolved, and it is ordered accordingly.

The Liquidator is further directed to serve a copy of this order upon the Registrar of Companies, West Bengal, immediately and, in any case, within fourteen days of receipt of this order. The Registrar of Companies shall take further necessary action upon receipt of a copy of this order.

The Liquidator shall stand discharged from his responsibilities, subject to all procedural compliances.

IA(IBC)1351(KB)2023 is allowed with the above directions and both the IA(IBC)1351(KB)2023 and CP(IB)/231(KB)2019 are accordingly disposed of.

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

Certified copy of this order may be issued, if applied for, upon compliance of all requisite formalities.

File be consigned to records.