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Judgment
Per Shri H. V. Subba Rao, Member (Judicial)
It is an application filed by the Applicant State Bank of India, secured Financial Creditor, seeking liquidation of the Corporate Debtor namely (M/s. Ultimo Fabrics Ltd.) on the ground that no resolution plan has been received by him, hence this application under Section 33 (1) of the Insolvency and Bankruptcy Code, 2016, praying following reliefs:
a. To pass an order under Section 33(1) of the Code for liquidation of the Corporate Debtor;
b. To appoint a Liquidator of the Corporate Debtor in accordance with section 34 of the Code;
The Adjudicating Authority vide its order dated 07.09.2018 on a Petition filed by the Operational Creditor under Section 9 of the Code directed initiation of the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor namely M/s. Ultimo Fabrics Pvt. Ltd., wherein Mr. Shyam Sundar Kasera, was appointed as Interim Resolution Professional (IRP). Thereafter, in the 3rd Committee of Creditors (CoC) meeting held on 24.10.2018, Mr. Shyam Sundar Kasera, was resolved to be appointed as Resolution Professional (RP).
It is further submitted that an advertisement, inviting Expression of Interest (EoI) in Form A was published on 12.09.2018 in “Free Press Journal” Mumbai Edition in English and “Navshakti” Marathi Edition in Marathi, the same was uploaded on the IBBI site.
It is further submitted by the Counsel for the Applicant that an advertisement, inviting Expression of Interest (EoI) in Form G was published on 21.11.2018 and 20.01.2019 being the last date for submission of Expression of Interest. Thereafter, no EoI was invited and no Resolution plan was received. It is submitted that the CIRP period was not extended further.
The CoC in its meeting decided to appoint a Valuer. The RP accordingly appointed two registered valuers as required under Regulation 27 of the IBBI (IRP for Corporate Persons) Regulations, 2016 and the Information Memorandum was prepared as provided under Regulation 36(1) of the said regulation.
The Counsel for the Applicant submits that the in response to the publication in Form G an invitation for Expression of Interest two Expression of Interest was received from M/s. KGM Industrial Traders Pvt. Ltd. and Mrs, Monica R. shah. Thereafter, the prospective resolution applicant was provided with the information, evaluation matrix and others necessary documents and given time submit Resolution plan on or before 20.01.2019. But no Resolution Plan was however received within the stipulated period from the above Perspective Resolution Applicants.
The CoC in the 9th CoC meeting held on 26.02.2019, it was informed in the meeting that there are no chance of revival of the Corporate debtor Company. The following Resolution was passed;
“Resolved that the Committee of Creditors hereby approves the liquidation of the Corporate Debtor, as no Resolution Plan was received for any of the Prospective Resolution Applicant who had submitted “EOI” (Expression of Interest); Also resolved that all necessary steps be taken by the Resolution Professional to intimate to Hon’ble adjudicating authority as required under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 and an advocate be appointed by him for the purpose of filling application with hon’ble adjudicating authority, requesting to pass order for liquidation of the Corporate Debtor.”
Hence, the CoC in its 9th meeting held on 26.02.2019, unanimously with 100% voting rights passed a resolution for liquidating the company. Accordingly, the Resolution Professional filed this application for liquidation of the Company as provided u/s. 33 of the Insolvency & Bankruptcy Code, 2016 (Code).
Upon hearing the submissions of the Applicant and on the perusal of the Application and the documents enclosed therein it is found, the RP has complied with the procedure laid down under the Code; Regulations made thereunder. The reasons assigned in the petition with regards to taking the decision of liquidation of Corporate Debtor by COC appears to be convincing. Even otherwise more than three years had been elapsed after passing an order ordering initiation of CIRP against the Corporate Debtor and no Resolution Plan was received by COC. On verification, we are of the considered view that this is a fit case to pass liquidation order under sub-section 1 of section 33 of the Code for liquidation in the absence of any resolution plan. Hence ordered;
ORDER
a. The Interlocutory Application No. 1756 of 2021 is hereby allowed.
b. Ms. Mrudula Cletus Brodie, having Registration No. IBBI/IPA-001/IP-P01702/2019-2020/12681, Email Id: camrudulkejdiwal@gmail.com, herein is hereby appointed as Liquidator as provided under Section 34(1) of the Code.
c. That the Liquidator for conduct of the liquidation proceedings would be entitled to the fees as provided in Regulation 4(2)(b) of the IBBI (Liquidation Process Regulations), 2016.
d. The Liquidator appointed in this case to initiate liquidation process as envisaged under Chapter-III of the Code by following the liquidation process given in the Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016.
e. The Liquidator appointed under section 34(1) of the Code. Will have all powers of the board of directors, key managerial personnel and the partners of the Corporate Debtor, as the case may be, shall cease to have effect and shall be vested with the liquidator.
f. That the Corporate Debtor to be liquidated in the manner as laid down in the Chapter by issuing Public Notice stating that the Corporate Debtor is in liquidation with a direction to the Liquidator to send this order to the ROC under which this Company has been registered.
g. All the powers of the Board of Directors, key managerial persons, the partners of the Corporate Debtor hereafter ceased to exist. All these powers henceforth vest with the Liquidator.
h. That the personnel of the Corporate Debtor are directed to extend all co-operation to the Liquidator as required by him in managing the liquidation process of the Corporate Debtor.
That on having liquidation process initiated, 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.
j. 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.
k. The Interlocutory Application No. 1756 of 2021 is hereby allowed and disposed of.