M/s P.M. Cold Storage Private Limited vs M/s. Goouksheer Farm Fresh Private Limited & Ors.

Per: Rekha Kantilal Shah, Member (Technical)

The Corporate Debtor, Goouksheer Farm I, Fresh Private Limited, (hereinafter referred to as “GFFPL”, or the Corporate Debtor), is a Private Limited Company, incorporated under the provisions of the Companies Act, 1956. The registered office of the corporate Debtor is situated at 39, Sambhunath Pandit Street, Kolkata, West Bengal, India, 700025.

The Corporate Insolvency Resolution process under Section 7 of the Insolvency and Bankruptcy Code, 2016 was initiated against the corporate Debtor vide an order dated 13.12.2O19 of the National Company Law Tribunal, Kolkata Bench. Vide the said order, the Hon'ble NCLT had appointed Mr. Sanjeev Jhunjhunwala as the Interim Resolution Professional (hereinafter referred to as "IRP") and subsequently, the IRP was confirmed as the Resolution Professional (RP) by the CoC. Thereafter, by order of NCLT dated 28.02.2024 Ms. Brinda Bindarsaria, was appointed as the new Resolution Professional.

This application is filed by the applicant claiming following reliefs-:

Since no Expression of Interest (EOI) was received even after Form G was issued twice, the Committee of Creditors (CoC) approved the liquidation of the Corporate Debtor. The Resolution Professional (RP) subsequently filed an application before the Hon’ble NCLT under Section 33 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of liquidation proceedings as per the CoC's decision. The Hon’ble NCLT, Kolkata Bench, after reviewing the case, passed an order for liquidation on 05.06.2024 and appointed the applicant as liquidator. The applicant received the order on 7th June 2024, which was considered the Liquidation Commencement Date.

The applicant immediately, thereafter, made a newspaper publication of Public Announcement in Form B on 09.06.2024 in the Financial Express (English Newspaper) and Aajkaal (Bengali Newspaper)^{11.Public Announcement along with newspaper publication are annexed herewith and collectively marked as "Annexure B"}.

The said order was duly intimated to the Registrar of Companies by filing Form INC-28 on 27.06.2024 through the Ministry of Corporate Affairs (MCA) portal. Subsequent to the filing of Form INC-28, the master data of the Corporate Debtor, as reflected on the MCA portal, was accordingly updated to reflect the status as 'Under Liquídation'^{22.The copy of payment receipt, Form INC 28, along with the master data of the Corporate Debtor, are annexed hereto and collectively marked as "Annexure C".}.

A Preliminary Report and, an Asset Memorandum was also prepared. The aforesaid Preliminary Report and Asset Memorandum were filed before the National Company Law Tribunal, Kolkata Bench, by way of an application bearing IA (I.B.C)/1341 (KB) 2024 on 06.07.2024.

Pursuant to the public announcement so made, the Applicant received one fresh claim and an intimation from a claimant seeking to update the claim earlier submitted during the CIRP. The aforementioned claims, including those submitted during the CIRP and duly collated by the Interim Resolution Professional or the Resolution Professional but not resubmitted during the Liquidation Process, have been duly verified by the Applicant. That, on the basis of claims received from the stakeholders and after due verification of the same, the applicant prepared the list of stakeholders on 06.08.2024 and submitted the same before the NCLT, Kolkata Bench by filing an application in I.A. (I.B.C)/1781(KB) 2024 on 21.08.2024. The applicant on 06.08.2024 constituted the Stakeholders Consultation within 60 days from the Liquidation commencement date based on stakeholders prepared. The details of SCC members and their admitted amount of claims is given hereunder:

The Applicant had opened a new current bank account no. 3650823807 with Kotak Mahindra Bank, Kolkata Park Street Branch, West Bengal in the name of the Corporate Debtor, followed by the words "in liquidation" in a scheduled bank, for the receipt of all moneys due to the Corporate Debtor, which was activated for undertaking financial transactions. The said account^{33.A copy of the entire bank statement, along with the proof of closure of the bank account, is annexed hereto and marked as "Annexure F".} was closed on 29.05.2025.

The Applicant, in his capacity as Liquidator, has filed four (04) progress reports before the Hon'ble Tribunal, each outlining the material developments and actions undertaken during the course of the liquidation proceedings. The said progress reports were duly taken on record by the Hon'ble Tribunal from time to time.

The first meeting of the Stakeholders Consultation Committee (SCC) was duly convened on 14.06.2024 i.e. within seven (07) days from the Liquidation Commencement Date. However, on the very same day, the Applicant received an email communication from M/s. PM Cold Storage Pvt. Ltd., who was the sole member of the Stakeholders' Consultation Committee (SCC) at the relevant time, wherein it was intimated that an appeal was proposed to be filed against the liquidation order passed in respect of the Corporate Debtor, and accordingly, they refrained from attending the said meeting. Subsequently, the Applicant informed the said sole member of the adjournment of the SCC meeting due adjourned to lack of quorum and requested their presence at the meeting scheduled to be held on 15.06.2024. On the date of the adjourned meeting, the Applicant again received an email from M/s. PM Cold Storage Pvt. Ltd., wherein they reiterated their position and informed that the liquidation order would be challenged before the Hon'ble National Company Law Appellate Tribunal (NCLAT) immediately upon the reopening of the Appellate Tribunal after the summer vacation, due to which the meeting was not held.

The applicant further submits that despite repeated follow up communications from the applicant, requesting the cooperation and participation of the said SCC member in the liquidation process, M/s. PM Cold Storage Private Limited maintained its stance. Subsequently, the stakeholder preferred an appeal before the Hon'ble NCLAT, which was dismissed by order dated 25.07.2024 of the Hon'ble NCLAT^{44.A copy of the order dated 25.07.2024 of the Hon'ble NCLAT is annexed hereto and marked as "Annexure I".}.

Thereafter, the first meeting of the Stakeholders' Consultation Committee was convened on 16.08.2024, pursuant to persistent follow-up by the applicant. The resolutions that were put up for voting were not voted upon by the SCC members, resulting in the absence of any decision on the agenda items.

The second meeting of the SCC was convened on 21.11.2024, wherein Mr. Ghosh representing the SCC member was present and assured the Liquidator of his cooperation. However, even in the second SCC meeting, no conclusive decision was taken by the SCC member on the agenda items.

Subsequent to conclusion of 2nd SCC meeting, the Applicant sent multiple emails to the SCC member requesting confirmation of availability to convene the next meeting of the committee. However, no response was received from the SCC members. Left with no recourse, the Applicant issued a final communication stating that in the absence of any cooperation, he would be constrained to approach this Tribunal for appropriate directions. Pursuant thereto, the SCC member agreed in participate, and the third meeting of the SCC was successfully convened on 15.03.2025, wherein the agenda items were duly discussed. In the said 3rd SCC meeting, the applicant had informed the SCC member that the Corporate Debtor has no business and does not have any tangible assets and Corporate Debtor has only assets under the Securities or Financial Assets class which is Bank balance and Fixed Deposit.

Subsequently, the fourth meeting of the SCC was convened on 08.05.2025 to discuss about the dissolution of the Corporate Debtor and other related matters. During the meeting, the agenda pertaining to dissolution of the Corporate Debtor was discussed in detail and after detailed discussion, the SCC member approved the proposal for dissolution of the Corporate Debtor, considering the prevailing status of the liquidation process.

The applicant further submits that upon the commencement of the Liquidation Process of the Corporate Debtor, the Corporate Debtor had assets under the Securities or Financial Assets class, only comprising Bank Balance and Fixed Deposit. The valuations done by Mr. Neeraj Kumar Sureka and Mrs. Vidhi Chandak for Securities or Financial Assets has been considered. The summary of the valuation done is mentioned below:

It is pertinent to mention that as per the existing valuation reports, the average Liquidation Value of the Corporate Debtor was Rs. 30,40,018.40 assigned to Bank Balance, Cash Balance and Fixed Deposit. However, as per the Balance Sheet as on the Liquidation Commencement Date, the value of the assets was reduced, which is detailed hereunder:

The applicant had also placed an agenda for the dissolution of the corporate debtor before the SCC in the said 4^th SCC meeting, which was attended by the RP of P.M. Cold Storage Private Limited only. The said agenda was discussed at length and after considering the prevailing status of the liquidation process, the SCC member approved the proposal for dissolution^{55.Minutes of the 4th SCC meeting, together with results, is annexed hereto and form part of "Annexure K} of the corporate debtor and passed the following resolution with 97.46% votes in favour

It is significant to mention that during the CIRP process, the erstwhile RP- Mr. Sanjeev Jhunjhunwala had filed a PUFE application, being numbered as IA (I.B.C)/855(KB)2020 before the Hon'ble NCLT Kolkata Bench on 24.08.2020. The said application was taken up from time to time, and after completion of pleadings is pending for adjudication. The details of the PUFE Transactions are given hereunder:

It is pertinent to mention here that in the said 4th SCC meeting held on 08.04.2025, the agenda for Treatment of avoidance of transaction in accordance with the provisions of the Regulation 44 A of the Liquidation Process regulations was also discussed. After due discussion and deliberation, it was discussed that the PUFE application shall be pursued by the Financial Creditor P.M. Cold Storage Private Limited and Proceeds, if any, shall be distributed in accordance with section 53 of the Code.

On the 4th SCC meeting, the Applicant has duly apprised and deliberated upon the status of the aforesaid pending applications with the SCC member, P.M. Cold Storage Private Limited, who is also the applicant in the said pending matters except in PUFE application in IA(I.B.C)/855(KB)2020. The RP of P.M. Cold Storage Private Limited conveyed that he would need to obtain a legal opinion to determine whether to pursue or withdraw the said applications. He further informed that the CoC of P.M. Cold Storage Private Limited has advised him to conclude the liquidation process of the Corporate Debtor to avoid incurring any additional costs. During the meeting, RP had requested the applicant herein, to proceed with the completion of the liquidation process. The RP of P.M. Cold Storage Private Limited had also emphasised that the filing of the application for conclusion of the liquidation process of the Corporate Debtor should not be prevented on account of the pendency of these applications. The applicant further submits that the PUFE application will be pursued by the Financial Creditor and proceeds if any, shall be distributed in accordance with section 53 of the Code.

During the CIRP of the Corporate Debtor, no estimated Liquidation Cost was approved. The Applicant in the 1st, 2nd and 3rd SCC meetings had placed the agenda items for approval of Liquidator's Fee. Ratification of Liquidation Costs and approval of estimated liquidation costs, however, these agenda items were not considered in all three SCC meetings. Thereafter, in the 4th SCC meeting held on 08.04.2025, the applicant had placed the details of Liquidation Costs of Rs. 2,37,497.00 incurred till 07.04.2025 on an actual basis. The summary of costs so placed during the meeting is given here under:

The applicant submits that during the said meeting, the RP of P.M. Cold Storage Private Limited informed that a sum of Rs. 1,20,000 had been proposed towards meeting all Liquidation Costs excluding the Liquidator's fee, which was fixed at Rs.4.80 Lakh for the entire process. The Applicant, however, expressed his dissatisfaction with the said proposal to ratify the costs limited to Rs. 1.20 lakh, despite the actual out-of-pocket expenses incurred amounting to Rs. 2.37 lakh. Thereafter, the Applicant had requested the RP to obtain approval for the ratification of the balance amount of Liquidation Costs incurred in the process, to which the Resolution Professional had agreed. The Applicant further submits that, pursuant to the discussions held during the fourth meeting of the Stakeholders' Consultation Committee (SCC), an email was sent by the Applicant on 14.05.2025 to the SCC member, requesting ratification of the balance amount of the Liquidation Cost. In reply to the email of the applicant, the RP of P.M. Cold Storage Private Limited has informed by email dated 19.05.2025 that the matter will be taken up in the next CoC Meeting for consideration of the members. It is submitted that an amount of Rs. 1,17,497/-, being part of the Liquidation Cost incurred prior to the said 4th SCC meeting, along with a further sum of Rs. 30,500/-, incurred subsequent to the said meeting, aggregating to a total of Rs. 1,47,997/-, remains pending and payable to the Applicant. It is further humbly submitted that in case the said amount is not reimbursed by the Financial Creditor, the applicant would be compelled to bear such un-ratified costs from his own resources, despite such expenses being incurred in the course of discharging duties under the Code in the Liquidation Process of the Corporate Debtor.

The Applicant humbly submits that the current account bearing No. 00082320027586 maintained by the Corporate Debtor with HDFC Bank has been duly closed. Prior to such closure, the available bank balance of Rs. 12,627.89 along with the proceeds from the redemption of fixed deposits of Rs. 20,64,920.49, amounting to a total of Rs. 20,77,548.38, was transferred to the liquidation account of the Corporate Debtor. Thereafter, Fixed Deposits of Rs. 20,00,000/- was again created from the Liquidation Account which was then redeemed and utilised towards the settlement of unpaid costs incurred during the Corporate Insolvency Resolution Process (CIRP), liquidation costs, and the remaining balance was distributed in accordance with the provisions of Section 53 of the Insolvency and Bankruptcy Code, 2016. The details of the distribution^{66.The final Audited Cumulative Receipt & Payment since the Liquidation commencement date till 27.05.2025 is marked as "Annexure O".} so made are set out herein below:

That, as per the mandatory requirement under Regulation 45(3) of the Liquidation Regulations, the liquidator has also prepared a compliance certificate in the prescribed Form H^{77.A copy of Form H marked as "Annexure P".}.

The Applicant respectfully submits that the Final Report, as mandated under Regulation 45 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, has been duly prepared on 30.05.2025. The said report sets out all material facts and information pertaining to the liquidation process of the Corporate Debtor and provides a comprehensive account of the manner in which the process has been conducted, including how the corporate debtor's assets have been liquidated^{88.A copy of the final report marked as "EXHIBIT A".}.

We have gone through the case file carefully and perused the pleadings of the parties and documents placed on record by the parties and heard the arguments put forth by learned Counsels for the parties; and after hearing the learned counsels for the parties, we shall now proceed to consider the present petition on its merits, specifically within the ambit of points involved in the instant application.

It is evident from the ‘Form H’ that assets as per Asset Memorandum and Final Sale Report are as under:-

At this juncture, we would go through the various provisions of the Insolvency & Bankruptcy Code dealing with the dissolution of the Corporate Debtor which are as follows:-

Rule 45 of Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016:

We would note that the Applicant in compliance to the Code and its Regulations has discharged his duties. The Bank Account no. 3650823807 with Kotak Mahindra Bank, Kolkata Park Street Branch, West Bengal in the name of the Corporate Debtor, followed by the words "in liquidation" in a scheduled bank, for the receipt of all moneys due to the Corporate Debtor, which was activated for undertaking financial transactions. The said account^{99.A copy of the entire bank statement, along with the proof of closure of the bank account, is annexed hereto and marked as "Annexure F".} was closed on 29.05.2025.

The liquidation Process is fully complete. Thus, the Liquidator in compliance has filed the present application under Section 54 read with Regulation 45 of IBBI (Liquidation Process) Regulation, 2016, seeking an Order of dissolution of the corporate debtor.

In compliance of regulation 15 of the Liquidation Process Regulations, the Liquidator has filed four Progress Reports from time to time before this Adjudicating Authority and also the final report disclosing all the material facts and information with respect to the liquidation process of the Corporate Debtor. As per mandatory requirement under regulation 45(3) of the Liquidation Process Regulations, the Liquidator has prepared a compliance certificate under prescribed ‘Form H’ marked as Annexure P.

A conjoint reading of these the statutory provisions as noted supra, mandates upon completion of the liquidation of the assets of the corporate debtor, filling of subsequent application to the Adjudicating Authority to seek dissolution under Section 54 of the IBC where the assets of the Corporate Debtor either have been completely liquidated after distribution among the Stakeholders or for early dissolution under Regulation 14 of the Liquidation Process Regulations, or where the realizable properties of the corporate debtor are insufficient to cover the cost of the liquidation process, the liquidator may apply to the Adjudicating Authority for early dissolution.

Agenda No. 9 of 4^th SCC meeting is as follows-:

INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (LIQUIDATION PROCESS) REGULATIONS, 2016

Taking into consideration the above “to continue proceeding under section 66” of the code can be assigned as also discussed in the 4th SCC meeting, therefore, in exercise of its inherent powers under Rule 11 of the NCLT Rules, 2016, the Tribunal has considered the circumstances necessitating the end of the liquidation process of the Corporate Debtor. Therefore, the Financial Creditor M/s P.M. Cold Storage Private Limited is hereby directed to proceed forthwith the Section 66 Application being as IA (I.B.C)/855(KB)2020.

In view of the above facts and circumstances, this Adjudicating Authority in exercise of the powers conferred under sub-section (2) of section 54 of the Code hereby Orders dissolution of the Corporate Debtor, i.e., Goouksheer Farm Fresh Private Limited from the date of this Order, thus stands dissolved and consequently, the Liquidator stands relieved from his responsibilities, subject to procedural compliances.

The Liquidator and the Registry are hereby directed to serve a copy of this Order upon the Registrar of Companies, West Bengal, within seven days of receipt of this Order. The Registrar of Companies shall take further necessary action upon receipt of a copy of this Order.

Further, the Liquidator is directed to serve a copy of this Order upon the Insolvency and Bankruptcy Board of India (IBBI) within fourteen days of receipt of this order. The IBBI shall take further necessary action upon receipt of a copy of this Order.

All the assets of Corporate Debtor have been disposed of and distributed in accordance with the code and rules and regulations framed thereunder and the final report has been submitted.

The Tribunal has considered the submissions regarding the Liquidator's fees claimed to the tune of Rs. 4.80 lakhs. It is noted that this amount is more than double the actual liquidation expenses incurred in the matter. The principle governing the fixation of the Liquidator's fee is that such fee should be reasonable, proportionate, and commensurate with the liquidation expenses and complexity involved in the liquidation process.

Regulation 4 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 prescribes that the Fee payable to the Liquidator shall be proportionate to the value of the liquidation estate and costs actually incurred. In the present case, no tangible basis or supporting rationale has been demonstrated justifying charging a fee more than twice the liquidation expenses. The prescribed principle of proportionality and reasonableness must prevail so that the interests of stakeholders are not prejudiced. Accordingly, the Tribunal finds no basis to accept a hefty liquidation fee of Rs. 4.80 lakhs that is excessive in relation to the liquidation expenses. The fee is required to be fixed in accordance with the applicable regulations, and the principles of fairness and proportionality. The Liquidator is directed to consider the payment already made to be full and final and reduce the fees to the extent the liquidation expenses is not paid for.

I.A.(IBC)(DIS.)/11(KB)2025 is allowed with the above directions that the I.A.(IBC)(DIS.)/11(KB)2025 and C.P.(IB) No.1582/KB/2019 is hereby disposed of accordingly.

In light of the above I.A.(IBC) NO. 491/KB/2020, IA(I.B.C)/1087(KB)2020, IA(I.B.C)/1040(KB)2020 and I.A. (I.B.C)/816(KB)2020 is dismissed as infructuous.

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 with the Registry, upon compliance of all requisite formalities.

File be consigned to records.