National Commercial Corporation vs Apex Engineering Solution And Services Private Limited

Per: Suchitra Kanuparthi, Member (Judicial)

An Application is submitted by the liquidator dated 28.11.2019 seeking an Order u/s. 54 of the Insolvency Code for granting “Dissolution of Corporate Debtor”.

As a First step, on receiving Form No. 5 from an ‘Operational Creditor’ viz. M/s National Commercial Corporation against the Corporate Debtor Apex Engineering Solution & Services Private Limited, an order was passed on 19.07.2017 admitting the Petition u/s 9 of I&B Code by appointing an Interim Resolution Professional Mr. Jitesh Gupta. As a consequence, clauses of Sec. 14 of the Code i.e. pronouncement of ‘Moratorium’ were also directed to be applicable during the CIRP period.

Public announcement was carried out, the IRP received claims from financial creditor, Domviwali Nagarik Sahakari Bank for an amount of Rs. 13,08,01,117/-. The Meetings of the Committee of Creditors were conducted from time to time. In one of the Meeting of Committee of Creditors, held on 06.12.2017 the IRP was appointed as Resolution Professional.

In view of the fact that there was no resolution Applicant and that no resolution plan was forthcoming, in the Committee of creditors meeting of 12.03.2018 it was decided to initiate ‘Liquidation’ proceedings.

The resolution professional had appointed two valuers to submit valuation Reports and the liquidation value. As per the reports were Rs. 78,44,467/- and Rs. 48,45,900/- hence the average amount of Rs. 63,45,183/ was being considered.

MA 523 of 2018 was filed by the Resolution Professional on 31.05.2018 seeking an order for commencement of “Liquidation” process in respect of Corporate Debtor M/s Apex Engineering & services Pvt. Ltd.

In view of the factual position that no Resolution Plan was received, the order of liquidation was passed on 19.06.2018 as per the Chapter III of the code and it was further ordered that the Resolution Professional shall function as liquidator.

Pursuant to the Receipt of the aforesaid order, and in compliance to the provisions of Regulation 12 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, the applicant had made a Public announcement in "Form B within Five days from his appointment one in "Business Standard" English Language Newspaper and one in "Lokmanthan" regional language newspaper (Marathi) on 30.08.2018,

Further in compliance to the Regulation 31 (2) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, and in term of the Provisions of Regulation 12(3) the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, list of Stakeholder was published in "Financial Express" English Language News Paper and "Lokmanthan" Regional Language Newspaper on 10.12.2018.

The Applicant in compliance of regulation 13, 15, 34 & 36 of 1881 (Liquidation Process) Regulations' 2016, Liquidator has duly submitted its preliminary report, Progress report, sale report and Asset Memorandum to the Authority on 04.10.2018 and 08.01.2019, and 06.07.2019 respectively.

This Hon'ble Tribunal has vide order dated 11 .01.2019 approved the sale of assets of the corporate Debtor in liquidation on receipt of confirmation from the Secured Creditor i.e. Dombivili Nagari Sahakari Bank Limited for relinquishing their security interest in favor of Liquidator as per the provisions of the Section 52(1) of the Insolvency and Bankruptcy Code,2016

The Liquidator managed to recover Rs.515,785/- (other than sale of Assets and after adjusting pre-Liquidation Items) amount due to Corporate Debtor.

This bench vide order dated 11.01.2019 ordered sale of the assets of the Corporate debtor through a-Auction process for Rs.41,00,000/- with 1.25%> increment to the reserve price i.e. Rs.40,00,000/- and the scrap assets of the Corporate debtor was sold as slump sale for Rs.25,000/-

The Liquidator had submitted Revised "Assets Sale Report" as an annexure to the Progress report dated 13.04.2019 with this Hon'ble bench in compliance to the Provisions of the Regulation 36 of the 1881 (Liquidation Process) Regulations 2016.

After the "Sale of Assets" and "other receipt forms the Debt due to the Corporate Debtor" the Liquidator had a total amount of Rs.4,640,785/- (After Adjusting Pre-Liquidation CIRP and Liquidation cost.

That the Liquidator had disbursed the Amount realized from the sale of Assets and other Receipt to the Financial Creditor i.e. Dombivili Nagari Sahakari Bank Limited, after adjusting the Liquidation Cost in the following Manner; -

Liquidator Fee (i+ii+iii) On Realization (Within months 789603*5%): 39480 (Within 12 months 4125000*3.75% 158969 198449 ……………………..(i) 2,76,819 On Distribution (20,00,000*0.94%): 18800 On Distribution (18,45,110*0.94%): 17344 …………………….(ii) 36144 GST 18% of 2,34,593 (198449+36238): 42,226 …………………….(iii)

The liquidator in compliance to the provisions of the Regulation 45 of the 1881 (Liquidation Process) Regulations 2016, submitted a "Final report prior to dissolution" comprising all the relevant information in respect to "details of Liquidation of corporate debtor's assets, along with "Compliance certificate under form H".

Upon perusal of the Final Liquidation Report and Form H, this Bench holds that the assets of the Corporate Debtor have been completely liquidated, and hence directs the dissolution of the Corporate Debtor in terms of power conferred to order Dissolution Sec 54 of I & B Code.

Section 54 of The Code reads as under: -

As a consequence, through this Order it is hereby declared that not only it is just and equitable for the purpose of ‘Liquidation’ as reported by Learned Liquidator, this is a fit case of a Corporate Debtor to be dissolved as prescribed u/s.54 of The Insolvency Code. Ordered accordingly, stood ‘Dissolved’ from the date of this Order.

Thus the Corporate Debtor Company stands Dissolved vide this order and no proceedings are now pending, therefore the Registry is directed that the case file be consigned to records.

Copy of this Order shall be forwarded within 7 (seven) days to the concerned authorities and the Registrar of Companies having jurisdiction, for further necessary action as prescribed under Law.