Radico Khaitan Limited vs Concept Biosciences India Private Limited

Per: Bidisha Banerjee, Member (Judicial)

The court convened through hybrid mode.

Ld. Counsels/Authorised Representative appearing for the parties were heard in extenso.

This application IA(IBC)/573(KB)2022 has been preferred to seek the following reliefs, inter alia: -

An order be passed directing the corporate debtor to go under liquidation as per Section 33(2) of the Insolvency and Bankruptcy Code, 2016;

An order be passed replacing the applicant with any other person to act as the liquidator in respect of the corporate debtor under Section 34(4) of the Insolvency and Bankruptcy, 2016;

Such further and/or other order and/or orders be passed, as this Learned Tribunal may deem fit and proper in the facts and circumstances of the present case;

Factual matrix of the case are as under: -

This Adjudicating Authority vide its Order dated 01st April, 2022 directed to initiation of the Corporate Insolvency Resolution Process (hereinafter referred to as “CIRP”) in the matter of M/s. Concept Biosciences India Pvt. Ltd. (“Corporate Debtor”), on a Petition filed by Radico Khaitan Limited (“Operational Creditor”) against M/s. Concept Biosciences India Pvt. Ltd. under Section 9 of the Insolvency and Bankruptcy Code, 2016 read with Rule 6 of the Insolvency and Bankruptcy 2016 being C.P. (IB)/74(KB)2020 and Mr. Ajay Kumar Agarwal is appointed as the Interim Resolution Professional (in short “IRP”).

- (b) In terms of Section 15 of the Code, public announcement was made on 04^th April, 2022 and the Committee of Creditors (in short “CoC”) was formed with viz. Radico Khaitan Limited. - (c) A report certifying the Constitution of the Committee of Creditors was filed on 22^nd April, 2022 before this Adjudicating Authority and report certifying the re-Constitution of the Committee of Creditors was filed on 19^th May, 2022 before this Adjudicating Authority. - (d) The IRP has circulated the Notice and notes on Agenda of First Meeting of the Committee of Creditors of Concept Bioscience India Private Limited on dated 25^th April, 2022 and the meeting of 1^st CoC duly held on 30^th April, 2022. Further voting result of the 1^st CoC also circulated on 5^th May, 2022, but the applicant was not confirmed by CoC with requisite majority of the voting share as the Resolution Professional and the CoC also not proposed any name of the new RP. - (e) The applicant has appointed valuers for the following class of assets to determine the fair value and liquidation value of the assets of the Corporate Debtor and the CoC in its 2^nd CoC meeting (adjourned) held on 19^th May, 2022 duly approved the Fee of Valuers with 55.98% voting shares of requisite majority.

Thereafter, the 2nd adjourned meeting of the CoC was held on 19th May, 2022. At the time of 2nd CoC meeting the Committee of Creditors had made a proposal for initiation of liquidation proceedings under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 and the said resolution being resolution no. 6 was approved by a voting percentage of 99.28% of the voting share. The relevant portion of the said agenda is extracted below: -

However, although all the members of the Committee of Creditors had discussed with regard to the Liquidation of CD, under Section 33(2) of the Code, but in regard to approval of meeting of estimated cost of Liquidation as per Regulation 39B of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) and Assessment of sale as a going concern as per Regulation 39C of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulation, 2016, the CoC members deferred the matter mentioning that “they will discuss later after that they will get back to the Chairman for the further course of action”.

In view of the aforesaid, under the provisions of Section 33(2) of the Code, 2016, the Corporate Debtor is required to sent for liquidation and necessary procedures will have to be followed.

The applicant, functioning under the contours of the Insolvency and Bankruptcy Code, 2016 and the regulations made thereunder, is duty bound to follow the provisions thereof. Since the CoC Members with requisite Majority under Section 33(2) of the Code approved the Liquidation of the Corporate Debtor before inviting of Expression of Interest and Resolution Plan. Accordingly, the applicant has no other option but to conform to the provisions of Section 33(2) of the Code the instant application is being made. The instant application satisfies all the conditions and requirements of the Code, 2016 for an Order to be passed for liquidation by this Adjudicating Authority.

Hence, the rival contentions were noted.

- (a) We have considered the submission made by the Ld. Counsel and perused the record. - (b) 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. - (c) Hence, we do find merit in the prayers made in IA(IBC)/573(KB)2022, and deem it fit to order liquidation of the Corporate Debtor.

- a. Prayers as sought for in IA(IBC)/573(KB)2022 filed by RP, is allowed and Concept Biosciences India Private Limited, the Corporate Debtor is ordered to be liquidated in terms of section 33(2) of the Code; - b. Mr. Sanjay Kumar Poddar having registration no. IBBI/IPA-001/IP-P01802/2019-2020/12759, email: [email protected], 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(IBC)/573(KB)2022 shall stand disposed of in accordance with the above directions.

List the main C.P. (IB)/74(KB)2020 for reporting progress on 26.06.2024.

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.