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Judgment
Per: Justice Telaprolu Rajani, Member Judicial
COMMON O R D E R IN IA (IBC) No.91 of 2022 & IA (IBC) No.92 of 2022
IA (IBC) No.91/2022 is filed seeking condone delay of Ten (10) days in filing application seeking approval for liquidation. The Corporate Debtor is not a going concern and there are no physical assets available and hence the Committee of Creditors at its 2nd meeting held on 10.04.2022 decided to recommend for liquidation of Corporate Debtor and authorised the IRP to final an Application before the Hon'ble Adjudicating Authority for Liquidation of Corporate Debtor. The 180 days' time limit prescribed by Section 12 of IBC, 2016 expired on 24.04.2022 and the Application is ready for filing but could not be e-filed on that day due to non-functioning of NCLT website. The Application for Liquidation of Corporate Debtor e-filing completed on 04.05.2022 involving a delay of 10 days. In view of the above, the delay of 10 days (i.e. from 24.04.2022 to 04.05.2022) is condoned. Hence, I.A.No.91/2022 is disposed of.
I.A(IBC) No.92/2022 is filed by the Resolution Professional under Section 33(1) (a) & 34(1) R/w Rule 60(5) of the Insolvency and Bankruptcy Code, 2016 (the Code) seeking orders for Liquidation of the Corporate Debtor i.e. M/s. V R V TEXTILES PRIVATE LIMITED and for appointment of Mr. J.John Ohilvi, Deemed Resolution Professional as Liquidator.
The brief facts of the Application are that:
I. The NCLT, Amaravati vide order dated 26.10.2021 admitted the Petition i.e., CP (IB) No.26/10/AMR/2021 under Section 10 of the Insolvency Bankruptcy Code, 2016 initiating Corporate Insolvency Resolution Process (CIRP) of M/s.V.R.V Textiles Private Limited and appointed J.John Ohilvi, as the Interim Resolution Professional (IRP) and directed him to take charge of the Corporate Debtor and take necessary steps in furtherance of CIRP.
II. The Interim Resolution Professional has issued Public Announcement on 28.10.2021. No claims were received from any financial creditor and hence the Committee of Creditors was constituted with Operational Creditors.
III. In the 1st CoC meeting convened on 24.11.2021, in which, the CoC represented by the Operational Creditors, did not attend and the same was adjourned. The 1st CoC meeting was held on 29.01.2022. The IRP could not take possession of the assets of the Corporate Debtor as there were no physical assets available and the CoC members were not willing to contribute and meet the CIRP Cost since the application was filed by the Corporate Debtors and its suspended directors. The CoC did not appoint the Resolution Professional as such, the IRP acted in the capacity of Deemed Resolution Professional.
IV. In the 2nd CoC meeting held on 10.04.2022 for the specific purpose of liquidation, the same was discussed and the proposal for liquidation was approved and authorised IRP/Deemed RP was directed to file an application before this Bench and the Deemed Resolution Professional expressed his willingness to act as Liquidator in the 2nd CoC meeting.
V. The CoC further approved the estimated liquidation cost of Rs.1.75 Lakhs and the fee of the Liquidator is fixed at Rs.40000/- per month which can be claimed as per Table in Regulation 4 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulation, 2016.
Hence the Applicant came up with this application and prayed to appoint him as Liquidator.
From the above, it would appear that despite all possible steps as required under the Code, taken during the CIRP, the CoC did not receive any viable proposal for revival of the Company. The CoC of Operational Creditors in its wisdom has resolved in favour of the Liquidation of the Corporate Debtor.
ORDER
Heard. In view of the facts stated in the Application, this Tribunal allows the Application with the following directions.
Mr. J.John Ohilvi, (IBBI/IPA-002/IP-N00902/2019-2020/12921), 3/95A, East of Medical College, Ananthan Nagar, Asaripallam, Nagercoil, Kanyakumari District, Tamil Nadu-629201, email: [email protected], Mobile No. 9842134891 is appointed as the Liquidator. No disciplinary proceeding is pending against him as per the IBBI website.
He shall issue public announcement stating that Corporate Debtor is in Liquidation.
The Moratorium declared under Section 14 of the IBC, 2016 shall cease to operate here from.
Subject to section 52 of the IBC 2016 no suit or other legal proceedings shall be instituted by or against the Corporate Debtor. This shall however not apply to legal proceedings in relation to such transactions as may be notified by the Central Government in consultation with any financial sector regulator.
All powers of the Board of Directors, Key Managerial Personnel and partners of the Corporate Debtor shall cease to have effect and shall be vested in the Liquidator.
The liquidator shall exercise the powers and perform duties as envisaged under Sections 35 to 50 and 52 to 54 of the Code, read with Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations 2016.
Personnel connected with the Corporate Debtor shall extend all assistance and cooperation to the Liquidator as will be required for managing its affairs.
The Liquidator shall be entitled to such fees as may be specified by the Board in terms of Section 34 (8) of the Code.
This Order shall be deemed to be a notice of discharge to the officers, employees and workmen of the Corporate Debtor, except when the business of the Corporate Debtor is continued during the Liquidation process by the Liquidator.
Copy of the Order shall be furnished to the IBBI, to the Regional Director (South Eastern Region), Ministry of Corporate Affairs; Registrar of Companies & Official Liquidator, Andhra Pradesh, the Registered Office of the Corporate Debtor; and the Liquidator.