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Judgment
Per: Bidisha Banerjee, Member (Judicial)
The court convened through hybrid mode.
Ld. Counsels appearing for the parties were heard in extenso.
This application IA(I.B.C.)/751(KB)2020 has been preferred to seek the following reliefs, inter alia: -
(a)To pass an Order of initiation of liquidation of GFFPL considering the facts and circumstances of the instant case;
(b)To appoint independent IP from its panel as a Liquidator of GFFPL;
(c)To pass such further and/or other order and/or orders be passed, as this Learned Tribunal may deem fit and proper in the instant case;
Factual matrix of the case are as under: -
The applicant made the first publications of 'Form G' on 12th March, 2020, inviting Expression of Interest (in short "EOI") in newspapers being Ekdin and Financial Express in response to which no EOI was received.
It is submitted that after lockdown was imposed due to COVID 19 pandemic from 25th March, 2020 to 06th June, 2020. As per IBBI circular dated 29th March, 2020 the period of lockdown might be excluded for considering the period of 180 days of CIRP. As per the MHA guidelines RP came out of containment zone on 06th June, 2020 and resumed its work accordingly. During this period, the RP had functioned offline and complied with all the formalities as per IBC. After date of unlock being 06th June, 2020, 180 days would end on 23.08.2020.
In the 5th CoC meeting held on 03.06.2020 it was resolved to go for 2nd publication of ‘Form G’. Accordingly, 2nd publication of ‘Form G’ was made on 09th June, 2020 in Financial Express & Ekdin. However, no response to the same, no EOI was received.
On 16th March, 2020 the applicant had informed Insolvency and Bankruptcy Board of India in compliance of Regulation 35(A) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 [as amended from time to time] and certain transactions were coming under the purview of Section 43 to 66 of Insolvency and Bankruptcy Code, 2016 and also that the transaction audit report were awaited by the applicant.
Thereafter, on 4th July, 2020 in the 6th meeting of the Members of the CoC, the applicant informed the Members of the CoC that despite the publication of ‘Form G’ twice as state above, no EOI was received. During the meeting, it was apprehended that since Corporate Debtor does not have any line of activity and no material assets, there might be difficulty in getting any resolution plan. On the basis of discussion two following possibilities came out and were accordingly, put to vote as under: -
Fresh publication of ‘Form G’ which was already done twice as stated above; and
Proceeding for liquidation and no Expression of Interest was received. It was also discussed that as per the provisions of the Insolvency and Bankruptcy Code, 2016 after the expiry of 180 days, the Corporate Debtor would automatically go into liquidation if extension of the period of CIRP process was not sought for.
In the said 6th CoC meeting, Resolution was adopted by 74.93% voting share that no further publication of ‘Form G’ was to be made and that the company may proceed for liquidation.
The application under Section 43 to 66 of the IBC Code on the basis of findings of the transaction auditor would be filed shortly, as due to COVID 19 pandemic and this time Adjudicating Authority is taking only urgent matters this time.
On the basis of the outcome of the CoC meeting and the authorisation provided to the Resolution Professional, the instant application has been initiated by the Resolution Professional of GFFPL as required under Section 33 of the Code and rules and regulations framed thereunder.
The Resolution Professional and the CoC had continuously made several efforts to revive and/or rehabilitate the Corporate Debtor, i.e., GFFPL, however, despite their best efforts, no commercially viable resolution plan received even after the publication of ‘Form G’ twice as stated above.
The applicant further states that 180 days of CIRP of GFFPL was expired on 23rd August, 2020. Moreover, no resolution plan / EoI was received by the CoC and, therefore, in the best interest of GFFPL and its stakeholders, etc. it is necessary that an Order of initiation of liquidation of GFFPL be passed by this Adjudicating Authority.
According to the CoC with 74.93% voting share there remains no justification and/or necessity of prolonging the CIRP of GFFPL, which are, in any event is due expire. Prolonging the CIRP process will increase the CIRP expenses.
Hence, the rival contentions were noted.
Analysis and Findings: -
We have considered the submission made by the Ld. Counsel and perused the record.
Section 33(2) of the Code enjoins the Adjudicating Authority to pass an order for liquidation of the Corporate Debtor when the CoC with 66% approves the Liquidation of Corporate Debtor.
Hence, we do find merit in the prayers made in IA(I.B.C.)/751(KB)2020, and deem it fit to order liquidation of the Corporate Debtor.
This Bench, therefore, hereby orders as follows: -
a. Prayers as sought for in IA(I.B.C.)/751(KB)2020 filed by RP, is allowed and Goouksheer Farm Fresh Private Limited, the Corporate Debtor is ordered to be liquidated in terms of section 33(2) of the Code;
b. Ms. Patanjali Chattopadhaya having registration no. IBBI/IPA-003/00450/2023-2024/14359, email: [email protected], Mob. No. 7000476726 is hereby appointed as Liquidator is hereby appointed as Liquidator as provided under section 34(1) of the Code subject to a valid Authorisation for Assignment (AFA) issued by the Insolvency Professional Agency (IPA) of which she is a professional member;
c. The Liquidator shall initiate liquidation process as envisaged under Chapter-III of the Code and the Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016.
d. Public Notice shall be issued in the newspapers stating that the Corporate Debtor is in liquidation.
e. All the powers of the Board of Directors, and of key managerial persons, shall cease to exist in accordance with section 34(2) of the Code. All these powers shall henceforth vest in the Liquidator.
f. The personnel of the Corporate Debtor are directed to extend all assistance and co-operation to the Liquidator as required by him in managing the liquidation process of the Corporate Debtor.
g. On initiation of the liquidation process but subject to section 52 of the Code, no suit or other legal proceeding shall be instituted by or against the Corporate Debtor save and except the liberty to the liquidator to institute suit or other legal proceeding on behalf of the Corporate Debtor with prior approval of this Adjudicating Authority, as provided in section 33(5) of the Code read with its proviso.
h. In accordance with section 33(7) of the Code, this liquidation order shall be deemed to be a notice of discharge to the officers, employees and workmen of the Corporate Debtor except to the extent of the business of the Corporate Debtor continued during the liquidation process by the Liquidator.
In terms of section 33(1)(b)(iii), the Liquidator shall file a copy of this Order with the Registrar of Companies, West Bengal, within whose jurisdiction the Corporate Applicant is registered.
The application bearing IA(I.B.C.)/751(KB)2020 shall stand disposed of in accordance with the above directions.
List the main C.P. (IB)/1582(KB)2019 for reporting progress on 20.08.2024.
The Registry is directed to send e-mail copies of the Order forthwith to all the parties and their Ld. Counsel for information and for taking necessary steps.
Certified copy of this Order may be issued, if applied for, upon compliance of all requisite formalities.