Mr. Bimal Ashok Desai vs Kandla Energy And Chemicals Limited

The case is fixed for pronouncement of order.

The order is pronounced in the open Court, vide separate sheet.

An Interlocutory Application is filed under Regulation 44(1), 45(3)(A) of the IBBI (Liquidation Process) Regulations 2016 read with Section 60(5) of the IB Code, 2016 read with Rule 11 of the National Company Law Tribunal Rules, 2016 seeking closure of liquidation process of the Corporate Debtor namely, Kandla Energy and Chemicals Limited.

Brief facts of the case, as averred by the Applicant are that the Financial Creditor i.e. State Bank of India filed application under section 7 of the Code for initiation of the Corporate Insolvency Resolution Process (“CIRP”) against the Corporate Debtor, which was admitted vide order dated 21.10.2022 and appointed Mr. Nimai Gautam Shah as Interim Resolution Applicant (“IRP”) of the Corporate Debtor.

That the said RP Mr. Nimai Gautam Shah filed IA no. 614 of 2023 under section 33 of the Insolvency and Bankruptcy Code, 2016 for seeking liquidation of the Corporate Debtor viz. M/s Kandla Energy and Chemicals Limited and vide order dated 29.01.2024 an order of Liquidation of the Corporate Debtor was passed by appointing Mr. Bimal Ashok Desai as the Liquidator.

That the applicant made public announcement on 03.02.2024 in Form-B as per Regulation 12 of the Liquidation Regulation whereby claims were received and Stakeholders Consultation Committee (“SCC”) was constituted as per Regulation 31A of the Liquidation Regulation. Accordingly liquidator had filed IA No. 529 of 2024 for constitution of SCC of the Corporate Debtor.

It is further submitted that the applicant had filed one IA bearing IA No. 711 of 2024 for filing preliminary report, Asset Memorandum and claim register and accordingly order was passed on 01.05.2024. The applicant in furtherance of his duties sold the CD as a going concern by way of an E Auction.

The CD had 2 assets and list of the same is as under:-

The total liquidation amount as per valuation report was Rs.1,32,10,000/-. The amount realized in liquidation is Rs.1,84,92,372/-.

After publishing the advertisement, the applicant received bid from M/s Parshwa Enterprise who accommodated affidavit u/s 29A of the IB Code to the liquidator and declared as the successful bidder and the liquidator has issued the certificate of sale. The applicant has also filed the assets sale report. It is also stated that all assets of the CD has been sold off by the liquidator and the amounts so realized has been distributed by the liquidator in terms of Section 53 of the IB Code, 2016.

In the 6th SCC meetings, stakeholders approved the filing of this application, noting the sale of the corporate debtor as going concern with realized amounts distributed and resolved to treat one secured creditor as unsecured creditor in light of judgment of the Hon'ble Supreme Court and the applicant, having submitted the final distribution table to the SCC members, who unanimously approved it, have resolved to file the present application for the closure of the corporate debtor's liquidation process.

The applicant has also filed Final Report dated 07.08.2024. As per Form-H the Fair Value is amounting to Rs. 1,84,26,759/- and the Liquidation Value is Rs. 1,32,10,000/-. There were total six meetings of SCC held. There is no other application pending in respect of avoidance transaction. The Liquidator has also filed the Asset Sale Report of the CD sold as a going concern after distributing the proceeds to 5 secured creditors in terms of Sec.53 of the IBC 2016. The liquidator has also furnished by affidavit the CA Certificate that the assets of the CD have been sold and the amounts have been distributed to stake holders and there are NIL balances as on 23.09.2024 of assets and liabilities of the Corporate Debtor.

Heard learned counsel for the parties and perused the record.

We observe that the applicant has sold the corporate debtor as a going concern, no application is pending in this matter and the proceeds of the sale are distributed among the stake holders in terms of Sec. 53 of the Code. The liquidator has filed his reply in the IA no. 1307 of 2024 filed for seeking certain reliefs which has been disposed of. Further, the liquidator will ensure to comply with the orders passed in IA no. 1307 of 2024 before relinquishing his duties as Liquidator by complying with Sec.35 of the Code read with IBBI (Liquidation Process) Regulations, 2016. Accordingly, the application for closure of liquidation deserves to be allowed.

Hence, we pass the following order:

The application i.e. IA No. 1382 of 2024 in CP(IB) 128 of 2021 is allowed and stands disposed of.