M/s Black Pearl Hotels Private Limited vs M/s Planet M Retail Limited

Per : Justice V.G. Bisht, Member, (Judicial)

This is an Interlocutory Application filed by the Resolution Professional (Deemed) Kshitiz Gupta under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 (the Code) for initiating Liquidation Process against M/s Planet M Retail Limited (Corporate Debtor).

The facts leading to the case in hand are as follows:

a. Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor was initiated by this Tribunal vide order dated 25.06.2019 upon admission of a Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 (the Code) and the Applicant herein was appointed as the Interim Resolution Professional (IRP) of the Corporate Debtor qua the Corporate Insolvency Resolution Process of the Corporate Debtor.

b. It is submitted that following the same order of the Bench appointing Mr. Kshitiz Gupta, the Applicant herein as the Interim resolution Professional of the Corporate Debtor to carry out the Function as mentioned under Insolvency and Bankruptcy Code, 2016.

c. The Applicant further states that the Committee of Creditors was constituted on July 18, 2019. The 5th Meeting of the Committee of Creditors was held on 04.03.2020, on which date, the members of the Committee of Creditors passed a resolution to Liquidate the Assets of the Company i.e. the Corporate Debtor

d. The Applicant further states that, during the said meeting, the CoC did not approve the appointment of the Applicant as the ‘Liquidator’ nor did the members of the CoC propose the name of any Liquidator to give effect to the resolution and conduct the process of liquidation. However, the Applicant being eligible to be appointed as the Liquidator, offers himself for the appointment and to act as the Liquidator of the Corporate Debtor.

e. The Applicant states that the Applicant has so far performed his duties as the Deemed Resolution Professional and discharged his functions as under the provisions of the Code.

f. Applicant herein has also prepared a detailed closure report with respect to the Corporate Insolvency Resolution Process of the Corporate Debtor detailing out the entire functions and activities performed by the RP since the commencement of CIRP till the filing of this Application. The said Report is annexed to the present Interlocutory Application as “Annexure - A2”.

Applicant submits that the Applicant has made all his efforts to sought cooperation from the Directors, the key managerial persons of the Corporate Debtor; however, he was never provided with co-operation by the Directors, Promoters and the Key managerial persons of the Corporate Debtor. The Applicant further states that this non-cooperation is persisting as on the date of filing of the present Interlocutory Application even after pronouncement of directions of this Bench upon an Interlocutory Application under section 19(2) of the Code.

To buttress his argument, the Applicant submits that this Bench is vested with the powers to pass an order of Liquidation of the Corporate Debtor; since, no Resolution Plan could be brought forth and voted for and in the absence of any Resolution Plan on the table, the order of liquidation shall be passed by this Adjudicating Authority under section 33 of the Code, which reads as under:

The Applicant, after due consent of the Committee of Creditors, had published 3 Form G i.e. invitation for Expression of Interest; however, despite several enquiries no resolution applicant successfully submitted a Resolution Plan for the Corporate Debtor. Pursuant to the same the matter was discussed at length by the members of the Committee of Creditors during its 4th and 5th meeting.

The Applicant states that the Applicant has till date discharged his duties as the Deemed Resolution professional. The Applicant states that there are certain CIRP costs incurred by the Applicant during the period of the CIRP which are still unpaid. The Applicant further states that the Applicant cannot even recover the said costs entirely from the resources available with the Corporate Debtor. The Applicant additionally states that members of the CoC have not contributed towards the infusion of funds being the cost involved for continuing the CIRP.

Further, the COC members did not approve a liquidation plan pursuant to regulation 39B of Insolvency and Bankruptcy Board of India (CIRP regulations), 2016 wherein the COC was required to decide on the manner in which the liquidation costs should be funded. The COC, which is being formed of the Operational Creditors, did not decide to contribute to the liquidation costs.

It would further appear that the members of CoC does not want to proceed in the matter of Corporate Insolvency Resolution Process of M/s Planet M Retail Limited in accordance with provisions of the IBC, 2016.

Further, the matter was listed on Board on 12.09.2023, on which date Ld. Counsel for the Applicant submits that the Bench may consider to appoint any Insolvency Professional as the Liquidator of the Corporate Debtor because as per the new circular of Insolvency and Bankruptcy Board of India, incumbent Resolution Professional cannot be continued as the Liquidator of the Corporate Debtor.

This Authority has left with no option except to pass an order for liquidation of the Company in the manner laid down in Chapter III of the Code considering the fact there is no Resolution Plan for consideration and CoC does not foresee any possibility of getting Plans in another round also. Hence ordered.

With the aforesaid observations and directions, the Interlocutory Application bearing IA No. 1126 of 2020, stands disposed of as Allowed.

There would however be no order as to costs. Ordered Accordingly.