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Judgment
Per: Prabhat Kumar, Member (Technical)
This is an Application filed under Section 54(1) of the Insolvency and Bankruptcy Code, 2016, (hereinafter called "Code") on 22.04.2023 by Mr. Rakesh Kumar Relan, Resolution Professional (IRP) appointed in the Corporate Debtor (hereinafter called “Applicant”), seeking direct dissolution of the Corporate Debtor viz. Sachika Trading Private Limited, having registered address at E-203, Kailash Industrial Complex, Veer Savarkar Marg, Park Site, Vikhroli (W), Mumbai – 400 079, Maharashtra.
The Company Petition filed by the Operational Creditor viz. Casabella Trading Private Limited, under Section 9 of the Insolvency & Bankruptcy Code seeking Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor was admitted by this Tribunal vide order dated 03.10.2022, wherein Mr. Rakesh Kumar Relan (Reg. No.: IBBI/IPA-001/IP-P02009/2020-21/13119) was appointed as the Interim Resolution Professional (IRP).
That the said IRP after inviting claims from the creditors through a public announcement published in newspapers on 08.10.2022, received only two claims (i) ₹7,94,00,127/- from Casabella Trading Pvt. Ltd. and (ii) ₹5,36,875/- from the Dy. Commissioner of Income Tax-15(3)(2), both totalling to ₹7,99,37,002/- were admitted in full by the IRP. Committee of Creditors was constituted (CoC) with sole Member viz. Casabella Trading Pvt. Ltd. It is stated that the First CoC meeting was held on 02.11.2022 wherein the IRP was appointed as Resolution Professional (RP). However, no application has been filed before this Adjudicating Authority for confirmation of the same. Thereafter, the Applicant published Form G in newspapers viz. ‘Active Times’ and ‘Mumbai Lakshdeep’ on 07.02.2023 inviting Expression of Interests (EoI) from interested resolution applicants with deadline for receiving such interests as 23.02.2023, however, no interests were received even till the time of filing this Application. Therefore, there was no possibility of Resolution Plan for the Corporate Debtor.
After scrutiny of the financial records of the Corporate Debtor, the Applicant found that there are certain receivables i.e. ₹7,85,50,435/- from M/s. Nano Minpro Pvt. Ltd. and ₹23,47,521/- from M/s. Nucleus Chem Oil Pvt. Ltd. and the same was apprised to the CoC. For the recovery of the same, notices were sent to the debtors on 20.02.2023, which were returned undelivered with remarks as “Door Locked”.
Applicant further submits that one Petition no. CP(IB)-302/MB/2021 under Section 9 of the Code has been preferred against Nano Minpro Private Limited, which is reserved for orders on 23.02.2023 by this Tribunal. However, low chances of recovery of the amount receivable as the debtor has no physical assets available. The Applicant further submits that he has not located any suspicious transactions which fall within the fray of the definition of “PUFE Transactions”.
Applicant further submits that he called Second CoC meeting on 27.03.2023 wherein the CoC resolved not to appoint any valuers for any class of assets in view of non-existence of assets of any kind in the nature of (i) Land and Building, (ii) Plant and Machinery or (iii) Securities and Financial Assets; and also resolved with 100% vote, to dissolve the Corporate Debtor directly, on account of no Resolution Plan being received; there being no recoverable receivables of the Corporate Debtor and the Corporate Debtor having no assets for distribution. The relevant resolution is reproduced below:
“RESOLVED THAT in view of no Resolution Plan coming forward for the Company and since the Company has no assets, the Hon’ble NCLT shall be requested to directly dissolve the Corporate Debtor (undergoing CIRP)."
"RESOLVED FURTHER THAT the Resolution Professional is authorized to directly file an Application u/s 54 of the Insolvency and Bankruptcy Code, 2016 for dissolution of the Company, without going into Liquidation."
"RESOLVED FURTHER THAT the Resolution Professional is authorised to do all other such needful things for the dissolution of the Company, as may be required".
Under Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 the Applicant has filed Compliance Certificate in Form H along with Final Report dated 01.04.2023.
Applicant has also filed Auditor's Report dated 31.03.2023 wherein the Auditor has given "Receipts and Payment" account with NIL receipts and NIL payments.
In the Final Report, the Applicant has given the following remarks:
i. There are no significant pending litigations. ii. There are no Assets of the Corporate Debtor. iii. There are no Bank Account of the Corporate Debtor since the bank account of the Corporate Debtor was closed even prior to the date of commencement of CIRP. iv. There are no Receipts and Payments during the CIRP period.
Applicant submits that upon his request to the Karnataka Bank, Mulund (W) Branch, the bank confirmed via mail that the A/c No. 5202000100105901 in the name of 'Sachika Trading Private Limited' was closed on 06.07.2021.
Applicant further submits that the CoC in its second meeting held on 27.03.2023 has given assurance to the Applicant about the payment of all the outstanding fees and CIRP expenses incurred.
As there are no assets, no EoIs received and no possibility of any resolution, the sole member of the CoC having passed a resolution with 100% voting majority approving the direct dissolution of the Corporate Debtor, the Liquidation process under Chapter III of Part II of the Code may deemed to have been completed and in order to avoid superfluous costs such as Liquidator's fee, public notice, etc. it is in the best interests of the Corporate Debtor to be dissolved u/s 54 of the Code. The Applicant also heavily relied upon the judgment of the NCLT, Bengaluru Bench in the matter of "Synew Steel Private Limited", relevant part of the order is given below:
"The above facts and circumstances of the Case justify that there would be no useful purpose served, by placing the Corporate Debtor under a Liquidation Process, under the extant provisions of Code. Since the Assets of Company were realized, the liquidation process under the provisions of Code is deemed to have been completed under Chapter III of Part II of Code, and thus it would be just and proper for the Adjudicating Authority to dissolve the Company, as proposed by Resolution Professional. The instant Application is filed in accordance with the law and the Resolution in question to dissolve the Corporate Debtor was approved by the Sole CoC, as detailed supra. We are satisfied that this is a fit case for dissolving the Applicant Company and allowing the Petition filed by the RP praying for the same."
The IRP/RP has filed this Application before this Tribunal under Section 54 of IBC, 2016 seeking an order of dissolution of the Corporate Debtor viz. Sachika Trading Private Limited.
On examining the submissions made by the Counsel appearing for the Applicant and the documents annexed to the Application, it appears that the affairs of the Corporate Debtor have been wound up and there is no asset(s) to be liquidated. We are satisfied from the documents on record that the dissolution is not with intent to defraud any person.
The above facts and circumstances of the Case justify that there would be no useful purpose served, by placing the Corporate Debtor under a Liquidation Process, under the extant provisions of Code. Since there is no Assets and the corporate debtor is engaged in trading business which has no taker, the liquidation process under the provisions of Code is deemed to have been completed under Chapter III of Part II of Code, and thus it would be just and proper for the Adjudicating Authority to dissolve the Company, as proposed by Resolution Professional. No party is going to be adversely affected thereby. In view of the above the Corporate Debtor deserves to be dissolved. Hence ordered that –
Sachika Trading Private Limited [CIN: U51109MH2011PTC213791], the Corporate Debtor, is hereby dissolved with immediate effect;
ii) The Registry is directed to forward a certified copy of this order to the Registrar of Companies, Mumbai within a period of seven days;
iii) The IRP/RP is discharged.
Accordingly, IA-1780/2023 is allowed and disposed of. Also, CP(IB)-662(MB)/2021 is hereby disposed of. Company Petition stands CLOSED. File to be consigned to records.