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Judgment
[ PER: BENCH ]
I. The instant Application is filed by the Resolution Professional (RP) of M/s. Impact Metals Ltd. (CD) under Section 33(2) of IBC, 2016 seeking to pass an Order of Liquidation of the Corporate Debtor by appointing the Applicant herein as Liquidator of the CD.
II. This Authority, vide Order dated 25.05.2023 admitted the Company Petition bearing CP (IB) No.254/7/HDB/2021 filed by Mr. Kudapa Gangadhar Rao & Another (OC) against the CD and initiated CIRP process by appointing Mr. Malireddy Ramana Reddy as the Interim Resolution Professional (IRP).
III. On assuming charge, the IRP took various steps/actions for completing the CIRP process.
IV. In response to the public announcement in Form-A on 31.05.2023 inviting claims from the stakeholders, the IRP received the claims, collated and submitted the list of creditors before the Committee of Creditors (COC).
V. Later, in the 1st COC Meeting held on 30.06.2023, the COC with 100% voting appointed Mr. Vakiti Vineeth Reddy as Resolution Professional (RP) in place of Mr. Malireddy Ramana Reddy, IRP.
VI. It is submitted that the RP had appointed four registered valuers on 27.07.2023, two of them were appointed for valuation of Plant and Machinery and the other were appointed for securities and financial assets of the CD.
VII. In Response to the publication in Form-G on 05.08.2023, 4 EOIs were received. Against the RFRP, after extending the last date for submitting the Resolution Plans from time to time, the RP received only one Resolution Plan from the Prospective Resolution Applicant, M/s.Vrindavan Packaging Limited (PRA), which was placed before the 5th COC meeting held on 22.12.2023.
VIII. The RP had filed an IA 1979/2023 seeking for extension of CIRP period by 90 days, which was allowed by this Authority, vide order dated 19.12.2023. Thereby, the last date for conclusion of CIRP was 9th March, 2024.
IX. The RP made certain observations in the Resolution Plan submitted by the sole PRA and requested to submit a revised Resolution Plan vide email dated 5th March, 2023 (Annexure-9).
X. After taking approval from the COC at its 6th meeting held on 08.03.2024, the RP had filed an IA 625/2024 seeking for extension of 60 days w.e.f. 10.03.2024 to 09.05.2024, which was allowed by this Authority, vide Order dated 03.04.2024.
XI. When the PRA did not submit the Revised Resolution Plan after making repeated follow ups, the RP sent a reminder mail on 31.03.2024 to submit the revised Resolution Plan by 14.04.2024. Vide email dated 05.05.2024, the PRA expressed his unwillingness to increase the bid value [Annexure-13 (colly.)].
XII. In the 7th COC Meeting held on 09.05.2024 i.e. on the last date of the CIRP of the CD, the COC has resolved with 100% voting share to liquidate the CD in view of non-receipt of any compliant Resolution Plan by appointing the Applicant herein as Liquidator of the CD and the Applicant herein has given his written consent (Annexures 14 & 15).
XIII. The last date for completion of the CIRP of the Corporate Debtor, after considering the extensions from time to time was 09.05.2024 and there was no valid Resolution Plan. Hence, the instant application.
XIV. We have heard the Learned Resolution Professional. A perusal of the contents of the application would show that the Resolution Professional has made his best efforts to keep the CD as a going concern, but since no Resolution Plan, which was viable, was received, the CoC with 100% voting has recommended for liquidation of the CD.
XV. 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.
XVI. In view of the facts stated in the Application, this Tribunal allows the Application with the following directions.
Mr. Vakiti Vineeth Reddy, having Registration No. IBBI/IPA-002/IP-N01250/2022-2023/14240, email: [email protected], Mobile: 9550046000 is appointed as the Liquidator. As per the IBBI website, his AFA is valid upto 12.12.2024. No disciplinary proceeding is pending against him as per the IBBI website.
He shall issue public announcement stating that the CD 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 CD. 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 CD 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 co-operation 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 CD, except when the business of the CD 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, Telangana, the Registered Office of the CD; and the Liquidator.
XVII. With the above directions, IA.No.11/2024 in CP (IB) No.254/7/HDB/2021 is allowed and stands disposed of.