M/s Indo Spirits vs M/s Path2way HR Solution Pvt. Ltd.

ORAL ORDER

“RESOLVED THAT, pursuant to the provisions of Section 33 of the Insolvency and Bankruptcy Code, 2016 (“Code”) and the applicable provisions of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the Members of Committee of Creditors of Path2Way HR Solutions Private Limited hereby accords its approval for initiation of liquidation of the Corporate Debtor, in terms of the provisions of the Code.

RESOLVED FURTHER THAT, in accordance with the provisions of Section 34(1) of the Code read with Regulation 3 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, the CoC hereby approves the appointment of Mr. Rabindra Kumar Mintri (IBBI/IPA‐001/IP‐P0707/2017‐2018/11194) as the Liquidator to conduct and administer the liquidation process of the Corporate Debtor, with remuneration as per the provisions of the Liquidation Process Regulations and as noted by the CoC.

RESOLVED FURTHER THAT the Resolution Professional is hereby authorised and directed to file an appropriate application under Section 33 of the Code before the Hon’ble National Company Law Tribunal (“NCLT”) and to undertake, execute and file all necessary forms, documents, affidavits, records, declarations, reports and any other papers, and to take such incidental, consequential, ancillary or other actions as may be required for effectively giving effect to the aforesaid resolutions of the CoC.”

The Representative of the Sole Financial Creditor, Pernod Richard India Private Limited, holding 100% voting share, approved the aforesaid agenda item. Accordingly, the resolution was passed with 100% approval.

“Where the resolution professional, at any time during the corporate insolvency resolution process but before confirmation of resolution plan, intimates the Adjudicating Authority of the decision of the committee of creditors ¹[approved by not less than sixty-six per cent. of the voting share] to liquidate the corporate debtor, the Adjudicating Authority shall pass a liquidation order as referred to in sub-clauses (i), (ii) and (iii) of clause (b) of sub-section (1).” In the wake of the aforementioned resolution passed by the CoC, the provisions of Section 33(2) of IBC, 2016, we are noted that the directed liquidation process.

“The Explanation under Section 33(2) has been inserted by Act of 26 of 2019 contains the legislative declaration and intention. The CoC in the Legislative Scheme has been empowered to take decision to liquidate the Corporate Debtor, any time after its constitution and before confirmation of the resolution plan. The power given to the CoC to take decision for liquidation is very wide power which can be exercised immediately after constitution of the CoC. The reasons which has been given in Agenda Item 1, it is made clear by the CoC that the Corporate Debtor is not functioning for last 19 years and all machinery has become scrap, even the building is in dilapidated condition and the CIRP will involve huge costs. We are not convinced with the submission of learned counsel for the Appellant that the CoC’s decision is an arbitrary decision. CoC is empowered to take decision under the statutory scheme and when in the present case the decision of the CoC for liquidation has been approved by the Adjudicating Authority, we see not good ground to interfere at the instance of the Appellant. However, we make it clear that the decision taken by the CoC was in the facts of the present case and it cannot be said that whenever decision is taken for liquidation the same is not open to judicial review by the Adjudicating Authority and this Appellate Tribunal. It depends on the facts of each case as to whether the decision to liquidate the Corporate Debtor is in accordance with the I & B Code or not. With these observations, the Appeal is dismissed.”