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Judgment
O R D E R
Per: Balraj Joshi, Member (Technical)
This Adjudicating Authority convened through hybrid mode.
This is an application filed by the Resolution Professional seeking liquidation of the Corporate Debtor, viz., Kharikatia Tea & Industries Limited (CIN: L70101WB1980PLC032922), on the ground that the Corporate Debtor is non-operational and does not have any assets except investment in shares of unlisted companies and the CoC by 100% voting share approved liquidation of the Corporate Debtor.
This Adjudicating Authority vide its order dated 01/12/2021 on a Petition filed by Majestic Commercial Private Limited (Financial Creditor) under section 7 of the Insolvency and Bankruptcy Code, 2016 (‘the Code’) directed initiation of the Corporate Insolvency Resolution Process (‘CIRP’) against the Corporate Debtor and appointed the Applicant herein as the Interim Resolution Professional (‘IRP’), a copy of the said order1 dated 01/12/2021 is annexed with the application as Annexure “A”. At the first CoC meeting held on 04/01/2022, IRP was confirmed as RP.
In terms of section 15 of the Code, public announcement2 in Form ‘A’ was published on 03/12/2021 in “Financial Express” (English), and “Aajkal” (Bengali), inviting claims from the creditors. The same was also uploaded in the designated website of the IBBI also. In response to the public announcement, only one claim was received, who is the petitioning financial creditor. Accordingly, Committee of Creditors (“CoC”) with sole member was duly formed.
At the 2nd CoC meeting held on 02/05/2022 the CoC with 100% voting shares decided to liquidate the Corporate Debtor since the company is non-operational and does not have any assets except investment in shares of unlisted companies recommending appointment of Mr. Birendra Kumar Tripathi, Resolution Professional, the applicant, as the Liquidator of the Corporate Debtor, who has given his consent to act as Liquidator of the Corporate Debtor. A copy of the minutes3 of the 2nd CoC meeting dated 02/05/2022 is annexed with the application as Annexure “C” to the application. A copy of the written consent4 given by the RP is annexed to the application as Annexure “E”.
However, the CIRP period has come to an end on 29/05/2022.
Altogether, two progress reports have been filed by the RP. RP has also held two CoC meetings altogether.
Section 33(1)(a) of the Code mandates that the Adjudicating Authority shall pass an order of liquidation where no resolution plan is received before the expiry of the CIRP. Sub-section (2) thereof requires the Adjudicating Authority to pass the liquidation order where the Resolution Professional intimates to the Adjudicating Authority the decision of the Committee of Creditors approved by not less than 66% of the voting share to liquidate the Corporate Debtor.
On conjoint reading of these two provisions, this Adjudicating Authority is left with no option but to order liquidation of the Corporate Debtor.
This Bench, therefore, hereby orders as follows: -
a. IA(IBC)/618(KB)2022 filed by Mr. Birendra Kumar Tripathi, Resolution Professional of Kharikatia Tea & Industries Limited, the Corporate Debtor, is allowed and the Corporate Debtor is ordered to be liquidated in terms of section 33(2) of the Code read with sub-section (1) thereof.
b. Mr. Birendra Kumar Tripathi [Reg. No. IBBI/IPA-N003/IP-N00229/2019-2020/12679], E-mail ID: [email protected], is hereby appointed as liquidator as provided under section 34(4)(c) of the Code, subject, however, to his possessing a valid Authorisation for Assignment (AFA) issued by the Insolvency Professional Agency (IPA) of which he is a professional member, in terms of regulation 7A of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2019.
c. The Liquidator shall initiate liquidation process as envisaged under Chapter-III of the Code and the Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016.
d. Public Notice shall be issued in the same newspapers, i.e. “Financial Express” (English), and “Aajkal” (Bengali), stating that the Corporate Debtor is in liquidation.
e. All the powers of the Board of Directors, and of key managerial persons, shall cease to exist in accordance with section 34(2) of the Code. All these powers shall henceforth vest in the Liquidator.
f. The personnel of the Corporate Debtor are directed to extend all assistance and co-operation to the Liquidator as required by him in managing the liquidation process of the Corporate Debtor.
g. On initiation of the liquidation process but subject to section 52 of the Code, no suit or other legal proceeding shall be instituted by or against the Corporate Debtor save and except the liberty to the liquidator to institute suit or other legal proceeding on behalf of the Corporate Debtor with prior approval of this Adjudicating Authority, as provided in section 33(5) of the Code read with its proviso.
h. In accordance with section 33(7) of the Code, this liquidation order shall be deemed to be a notice of discharge to the officers, employees, and workmen of the Corporate Debtor except to the extent of the business of the Corporate Debtor continued during the liquidation process by the Liquidator.
In terms of section 33(1)(b)(iii), the Liquidator shall file a copy of this Order with the Registrar of Companies, West Bengal, Kolkata, within whose jurisdiction the Corporate Debtor is registered. Additionally, the Registry shall also forward a copy of this Order to the Registrar of Companies, West Bengal, Kolkata.
The application bearing IA(IBC)/618(KB)2022 shall stand disposed of in terms of the above directions.
CP(IB)/834(KB)2020 to come up for filing of periodical report on 28.11.2022.
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.