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Judgment
This application has been filed inter alia seeking following prayers:
(a) Allow the present Application under section 33(2) read with section 60(5) of the Insolvency and Bankruptcy Code 2016 thereby directing Liquidation of the Corporate Debtor i.e., M/s Garvit Innovative Promoters Ltd. as recommended by COC in Agenda Item No. 09 of its 7" COC Meeting dated 27.08.2025; and
(b) Appoint Mr. Nirmal Kumar Bhesoni having IP Reg. No. IBBI/IPA 001/IPP00010/2016-17/10016 as Liquidator as proposed by the COC in Agenda Item No. 10 of its 7" COC Meeting dated 27.08.2025 and in terms of section 34 of the Insolvency and Bankruptcy Code 2016; and
(c) Pass any other/further order or directions under section 33 of Insolvency and Bankruptcy Code 2016 or such other provision, as deemed fit and appropriate in the facts and circumstances of the case as stated under the present application and in the best interest of justice.
The application has been filed under Section 33(2) read with 60(5) of the Code for seeking to initiate the liquidation process against the Corporate Debtor. The brief facts which are necessary for discussion in the present order for adjudication of the present application are that the CIRP was initiated against the Corporate Debtor on 16th February, 2023, and thereafter accordingly the IRP was appointed. It has been averred in the application that after his appointment as IRP/RP, he faced many hardships and difficulties in collation of the information and subsequent discharge of his duties for the purpose of publications of Form A and Form G in accordance with the provisions of the Code. He has also averred in the application and also submitted by the Ld. Counsel representing the RP that the Ex-management did not cooperate with the IRP/RP and as a result of which the consolidated information could not be collated. The RP has made strenuous efforts to identify the details of the assets of the Corporate Debtor, however in view of the non-availability of the information and non-disclosure of the availability of the assets from the books of accounts of the Corporate Debtor, it became nearly impossible for the RP to prepare the information memorandum and to invite the Expression of Interest.
It is further averred in the application that the CoC has been duly apprised of the said situation in its 6th and 7th CoC meeting in as much as the Corporate Debtor was not having any functional operational business, and therefore it was not running as a going concern.
Faced with this, the Ld. Counsel representing the Applicant/RP submits that in the 7th CoC meeting held on 27th August, 2025 and Agenda Item No.6 was put up before the CoC to discuss about the liquidation of the Corporate Debtor which was therefore voted by the sole CoC Member having 100% voting right as per the Agenda Item No.9 and approve the liquidation of the Corporate Debtor. The CoC had also discussed and approved a proposed plan to meet out the liquidation cost and the fixed fee of the Liquidator.
The averments as contained in Para No.9 of the present application in this context are worth reproducing hereunder:
9.That owing to the facts, circumstances and practical situation of the Corporate Debtor enumerated in the foregoing paras, the Applicant Resolution Professional, in the 7th COC Meeting held on 27.08.2025, had put forth an Agenda Item No. 6 to discuss upon the liquidation of Corporate Debtor in the circumstances of the developments under CIRP which was further voted upon by the sole COC having 100% voting rights at Agenda Item No. 09 which approved liquidation of the Corporate Debtor and authorized Applicant to file appropriate application before this Hon'ble Tribunal. Further, under Agenda Item No. 11, the COC had discussed and approved a proposed plan to meet out liquidation cost in terms of Regulation 39-B of the IBBI (Insolvency Resolution Process for Corporate Persons) 2016 and further, under Agenda Item No. 12, the COC had approved and fixed fee of liquidator in terms of Regulation 39-D of the IBBI (Insolvency Resolution Process for Corporate Persons) 2016.
The ground which have been enumerated in the present application are at Para No.10 which is also reproduced hereunder:
10.That in order to summarize the grounds on which the liquidation has been recommended by the COC with 100% voting, the same is provided hereunder:
i.No possible cooperation from suspended board of directors being behind the bars under judicial custody for past 6 years.
ii.No books of accounts and other records of Corporate Debtor available as ex-management is alleged to have registered office set on fire.
iii.No records available w.r.t. assets and liabilities of Corporate Debtor without which preparation of Information Memorandum (IM) is not possible.
iv.Corporate Debtor is facing huge and strict prosecution from Directorate of Enforcement, Economic Offence Wing and more than 10 other state agencies due to huge scam and fraud played by ex-management and suspended board of directors of Corporate Debtor of more than Rs. 3,000 Crore.
v.Even state and central agencies don't have custody of all the assets of the Corporate Debtor and affidavit submitted by EOW and the regular exploration and identification of assets of Corporate Debtor suggest that identification and custody of all the assets of Corporate Debtor is a continuous and ongoing activity which can only be conducted in Liquidation Proceedings.
vi.The maximum permissible CIRP period of 330 days in which CIRP is to be mandatorily completed has expired on 29.08.2025.
vii.Object and business model of Corporate Debtor is that of Ponzi Scheme in which more than 2 lakh investors have been cheated and defrauded, such business model and object of business operations can't be continued as the same are illegal and unconstitutional.
Therefore, in terms of the CoC decision as referred to above, one Mr. Nirmal Kumar Bhesoni having IP Reg. No. IBBI/IPA-001/IP-P00010/2016-17/10016 has also been proposed and recommended for appointment of the Liquidator subject to approval of this Tribunal. The consent of the proposed Liquidator has also been attached along with the present application and the AFA which is valid till 31st December, 2025 has also been attached as Annexure No.3 in the present application. The proposed Plan as referred to above for meeting of the liquidation cost has been stipulated at running Page No.59 of the paper book and the Plan for meeting out the fees of the Liquidator has also been given at Page No.61 thereof.
The voting record/list of the 7th meeting of the Committee of Creditors which was held on 27th August, 2025 is given at Page No.63, where the attendance of the Members of the CoC has been marked and the voting result of the 7th CoC meeting is given at Page No.64 which deal with the ratification with respect to the CIRP cost and pertaining to the provisional fees of the Resolution Professional and also to approve the liquidation of the Corporate Debtor which had been taken up vide Agenda Item No.9 in the aforesaid meeting of the CoC. As discussed herein above, the written consent of the Liquidator has been given at Page No.68 of the paper book.
We have perused the application and also have heard the Ld. Counsel representing the RP and are of the opinion that in view of the facts and circumstances given in the present application and also orally submitted, there are no assets in the Corporate Debtor and all the best efforts put in by the IRP/RP to collate the information have also not resulted into any exploration of the assets of the Corporate Debtor. It is therefore, in the interest of the process of law that the CIRP is further taken to its next logical step of initiating the liquidation process against the Corporate Debtor. The CIRP cost which has already been incurred and the liquidation cost which would be required to be incurred would be as per the averments made in the application which already stand approved in the 7th CoC meeting.
In view of the above, we allow the present application filed under Section 33(2) of the Code. In view of the Agenda Item No.9 of the 7th CoC meeting held on 27th August, 2025 and direct initiation of the liquidation process. We also deem it appropriate to appoint Mr. Nirmal Kumar Bhesoni as liquidator having IP Reg. No. IBBI/IPA-001/IP-P00010/2016-17/10016 which has been verified by Ld. LRA, Mr. Sarim Husain from the IBBI website and found to be correct and in order and in order to carry out the liquidation process subject to the following terms of the directions:
a. The Liquidator shall strictly act in accordance with the provisions of IBC, 2016 and the attendant Rules and Regulations including Insolvency and Bankruptcy (Liquidation Process) Regulations, 2017 as amended up to date enjoined upon her.
b. All the powers of the Board of Directors, key managerial persons, and the partner of the corporate debtor, as the case may be, hereafter cease to exist. All these power henceforth vest with the liquidator.
c. The personnel of the corporate debtor are directed to extend all cooperation to the liquidator as required by him in managing the liquidation process of the corporate debtor.
d. The liquidator will charge fees for the conduct of the liquidation proceedings in proportion to the value of the liquidation estate assets as specified by IBBI and same shall be paid to the liquidator from the proceed of the liquidation estate under section 53 of the Code.
e. The Liquidator shall issue the public announcement that the Corporate Debtor is in liquidation. In relation to officers/ employees and workers of the Corporate Debtor, taking into consideration Section 33(7) of IBC, 2016, this order shall be deemed to be a notice of discharge.
f. The Liquidator shall investigate the financial affairs of the Corporate Debtor particularly, in relation to preferential transactions/ undervalued transactions and such other like transactions including fraudulent preferences and file suitable application before this Adjudicating Authority.
g. The Liquidator is directed to proceed with the process of liquidation in a manner laid down in Chapter III of Part II of the Insolvency and Bankruptcy Code, 2016.
h. The Liquidator is directed to investigate the financial affairs of the Corporate Debtor in terms of the provisions of Section – 35(1) of IBC, 2016 read with relevant rules and regulations and also file its response for disposal of any pending Company Applications during the process of liquidation.
Once the liquidation process is initiated, subject to section 52 of the Code, no suit or other legal proceeding shall be instituted by or against the corporate debtor. The liquidator has the liberty to institute a suit and other legal proceedings on behalf of the corporate debtor with the prior approval of this Adjudicating Authority, as provided in sub-section (5) of section 33 of the Code.
j. This liquidation order shall be deemed to be notice of discharge to the officers, employees, and workmen of the corporate debtor except to the extent of the business of the corporate IA No. 988 of 2022 in CP(IB) 30 of 2022 debtor continued during the liquidation process by the liquidator.
k. It is directed that the liquidator to issue a public announcement stating that the corporate debtor is in liquidation. The liquidator will also serve a copy of this order to the various Government Departments such as Income Tax, GST, VAT, etc., who are likely to have any claim upon the corporate debtor so that the authorities concerned are informed of the liquidation order timely. The liquidator will also provide a copy of this order to the trade unions/employee associations of the corporate debtor.
l. The Liquidator shall submit a Preliminary report to this Tribunal within 75 (seventy-five) days from the liquidation commencement date as per regulation 13 of the Insolvency and Bankruptcy (Liquidation Process) Regulations, 2016. Further such other or further report as are required to be filed under the relevant Regulations, in addition, shall also be duly filed by him with this Adjudicating Authority.
The Registry is directed to communicate this order to the Registrar of Companies and to the Insolvency and Bankruptcy Board of India.
The order of Moratorium passed under Section 14 of the Insolvency and Bankruptcy Code, 2016 shall cease to have its effect and a fresh Moratorium under section 33(5) of the Insolvency and Bankruptcy Code shall commence.
Copy of this order be sent to the financial creditors, Corporate Debtor and the Liquidator for taking necessary steps and for extending the necessary co-operation in relation to the Liquidation process of the Corporate Debtor.
IA (Liq.) No.05/2025 stands allowed in the aforesaid terms.