The Indian Bank vs Dattar Ceramic Private Limited

The case is fixed for pronouncement of order. The order is pronounced in the open court, vide separate sheet.

This Interlocutory Application No.04 of 2026 in CP(IB) No. 141/NCLT/AHM/2025 has been filed under Section 33 and 34 of the Insolvency and Bankruptcy Code, 2016, on 10.03.2026 vide inward diary no E-00733 by Mr. Iqbal Singh Gandhi, Resolution Professional of the Corporate Debtor, Dattar Ceramic Private Limited for passing order of liquidation with the following prayers:

The brief facts as submitted by the Applicant are as under:

The Corporate Debtor, Dattar Ceramic Private Limited was admitted in Corporate Insolvency Resolution Process (“CIRP”) under Section 7 of the I.B. Code vide order dated 09.06.2025 under CP(IB) No. 141 of 2025 on the application filed by Indian Bank, the Financial Creditor.

This Bench, vide its order dated 09.06.2025 appointed the Applicant herein, as the Interim Resolution Professional (“IRP”). The IRP made public announcement of CIRP of the Corporate Debtor on 12.06.2025 as per Section 6 of I.B. Code, 2016 read with Regulation 6 of CIRP Regulations in Form “A” for submission of claim by the Creditors. The Applicant (RP) constituted the Committee of Creditors (“CoC”) comprising of Indian Bank as the sole Financial Creditor with 100% voting share, with an admitted claim of Rs. 49,16,18,766/-. The Applicant (RP) was appointed as Resolution Professional in the 1st CoC meeting held on 08.07.2025.

It is submitted that the 1st CoC Meeting was held on 08.07.2025 wherein the IRP apprised the members of the Committee of Creditors on the work undertaken after taking charge of the Corporate Debtor. The IRP apprised the members regarding the visits to the Registered Office of the Corporate Debtor, and reported that the land belonging to the Corporate Debtor was not properly demarcated and additionally, the vehicles reflected in the last audited balance sheet as forming part of the assets of the Corporate Debtor were not found in its possession.

It is stated that in the respective meeting, the RP sought clarification from the Suspended Board of Directors regarding vehicles, to which the Suspended Board apprised to have taken possession of the vehicles by certain creditors for outstanding dues of the said vehicles. Being a part of asset of the Corporate Debtor, the RP lodged FIR with the proper law enforcement authorities in the interest of the financial creditors.

It is further stated that the FC, Indian Bank requested RP to initiate the process of surveyor for demarcation of the land belonging to the CD and to take further legal measures for vacating and to take under possession. The CoC further resolved for appointment of Applicant as the Resolution Professional of the Corporate Debtor.

It is submitted that the 2nd CoC Meeting was held on 28.07.2025 wherein the Applicant apprised the CoC about draft Minimum Eligibility Criteria for the proposed Resolution Applicant, timelines of CIRP Process and Publication of Form G. The Applicant informed the CoC that he had duly appointed two registered valuers for each asset category. The Financial Creditor directed the RP to appoint a surveyor for the demarcation of the land and to take possession of the assets of the Corporate Debtor and further CoC instructed the RP to initiate action for vacating the land of the Corporate Debtor currently occupied by a person operating a Gowshala pursuant to a collector’s order.

It is submitted that the 1st Form-G was published on 29.07.2025 in compliance of Regulation 36A(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, inviting Expression of Interest from Resolution Applicants for the Corporate Debtor. The last date for submission of Resolution Plans as per Form-G was 22.09.2025.

It is stated that the 3rd CoC Meeting was held on 21.08.2025, wherein, the Suspended Board of Directors submitted that the land originally belonged to their ancestors and due to lack of clear demarcation, the factory building was inadvertently constructed. The Committee of Creditors noted that the Non-Agricultural (NA) order for Survey No. 2572 was issued in 2018. The CoC requested the Suspended Board of Directors to engage a government-approved surveyor for carrying out proper demarcation of the land and resolved for approval of draft RFRP. The applicant further directed the Suspended Board to provide complete details of the creditors who took the possession of the vehicles.

It is submitted that the 4th CoC Meeting was stated to be held on 23.09.2025.

It is submitted that the 5th CoC Meeting was held on 29.09.2025, wherein, the CoC was apprised that the RP had received only one Resolution Plan by one Ms. Rizwanabanu Kaladiya. Upon deliberation, the CoC observed that the financial offer offered under the Resolution Plan was significantly lower than the expectations of the CoC and the CoC unanimously decided to reject the Resolution Plan. The CoC advised the Resolution Professional to take necessary steps for issuance of a fresh publication of Form-G inviting Expression of Interest (“EoI”) so as to invite wider participation from prospective resolution applicants.

In the respective meeting, the Suspended Management informed the CoC that consents of other landowners/co-owners are required for the demarcation of the land. Some being family members are not agree to cooperate. Hence, RP advised the Suspended Management to proceed with the demarcation of the respective portion of land corresponding to the survey number of ownership.

It is submitted that the 2nd Form-G was published on 10.10.2025 in compliance of Regulation 36A(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, inviting Expression of Interest from resolution applicants for the Corporate Debtor. The last date for submission for resolution plans as per Form-G was 02.11.2025.

It is submitted that the 6th CoC Meeting was held on 05.12.2025 wherein the RP apprised that pursuant to the 2nd EOI Process, the RP had received only one plan by Ms. Rizwanabanu Kaladiya within the timeline and upon deliberation, the CoC observed that the financial offer offered under the Resolution Plan was significantly lower than the expectations of the CoC. The CoC granted the Prospective Resolution Applicant (PRA) one week's time to enhance the financial offer. The CoC, after deliberation, concurred that an extension of the CIRP period was required as the CIRP period was expiring on 06.12.2025. The CoC with 100% voting unanimously decided for the extension of the CIRP period and resolved to file an IA for seeking an extension of 90 days.

It is submitted that the Applicant filed an application under Section 19(2) of the Code against the Suspended Board of Directors and the statutory auditor for non-cooperation bearing IA No. 947 of 2025 wherein the Respondents assured to provide the documents and cooperate with the RP in the CIRP process, which was confirmed by the appearing counsel for the Suspended Managements, and this Bench disposed of the respective application vide its order dated 08.12.2025.

It is submitted that the Applicant further filed an application bearing IA No.1474(AHM)2025 before this Bench seeking extension in CIRP Period for 90 days in pursuance of resolution passed by CoC members in the 6th CoC meeting held on 26.12.2026. This Bench vide its order dated 10.12.2025 was pleased to approve the extension in CIRP by 90 days w.e.f. 07.12.2025.

It is submitted that the 7th CoC Meeting was held on 15.12.2025 wherein the CoC was apprised that the RP had received only one plan by Ms. Rizwanabanu Kaladiya, who sent an email conveying that the financial offer submitted by it was its final offer and requested that, in the event the same was not found acceptable by the CoC, the Earnest Money Deposit (“EMD”) be refunded. Upon deliberation, the CoC unanimously decided to reject the Resolution Plan and advised the Resolution Professional to take necessary steps for issuance of a fresh publication of Form-G for commencement of the 3rd Expression of Interest (“EOI”) process, so as to invite wider participation from prospective resolution applicants.

It is submitted that the 3rd Form-G was published on 19.12.2025 in compliance of Regulation 36A(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, inviting Expression of Interest from Resolution Applicants for the Corporate Debtor. The last date for submission for Resolution Plans as per Form-G was 12.02.2026.

It is submitted that the 8th CoC Meeting dated 16.02.2026 was adjourned to 23.02.2026 as Suspended Management submitted that they were in discussions with a prospective buyer and requested additional time to place the proposal of a genuine and eligible Resolution Applicant before the CoC. Thereafter, the 8th CoC meeting was held on 23.02.2026 wherein the RP apprised the members of the CoC that pursuant to the third publication of Form-G dated 19.12.2025, wherein, the last date for submission of the Resolution Plan was 12.02.2026, however, no resolution plan was received.

It is submitted that in the 8th CoC meeting held on 23.02.2026 (25.02.2026), the CoC members vide 100% of voting, voted in favour of liquidation. The CoC further resolved and approved to appoint Mr. Rajesh Malani as Liquidator vide 100% voting unanimously under Section 34(1) of Insolvency and Bankruptcy Code, 2016. The details of resolutions passed in the 8th CoC meeting are as under:

This bench, vide its order dated 06.05.2026 had directed to file a justification in consultation with the CoC that how the proceedings through liquidation will be more beneficial to the sole Financial Creditor in comparison to the action under SARFAESI Act, 2002 by the Financial Creditor. This Bench further issued notices to the Income Tax Department and the State Tax Departments and directed to file their reply qua their claims, if any, within two weeks.

In compliance of the above stated directions, the Sole Member of CoC, the Indian Bank filed an affidavit in reply in compliance of the above stated order on 19.06.2026 vide inward diary no. D-5033 as under:

As stated, in compliance with the said directions, the Indian Bank, being the sole member of the Committee of Creditors and the Resolution Professional, undertook discussions of the Corporate Debtor with regard to the status of the Corporate Insolvency Resolution Process and the future course of action required to be adopted in the present matter. During the course of such discussions, various aspects concerning the realization of assets of the Corporate Debtor were deliberated upon in detail.

Indian Bank, being the sole financial creditor and sole member of the Committee of Creditors, has on multiple occasions attempted to realise the value of the assets of the Corporate Debtor. In this regard, an E-Auction for sale of the immovable property of the Corporate Debtor was conducted on 21.02.2022. However, despite adequate opportunities being made available to prospective purchasers and despite efforts undertaken for sale of the asset, the auction process failed as no bidder came forward to participate in the auction proceedings. The failure of the auction clearly demonstrates the limited marketability and realization prospects of the immovable assets of the Corporate Debtor.

It is submitted that subsequent efforts were also undertaken through proceedings before the Hon’ble Debt Recovery Tribunal. The Hon’ble DRT, from time to time, directed sale of the immovable property of the Corporate Debtor and auction proceedings were ordered to be conducted vide orders dated 09.08.2023, 20.07.2024, 30.10.2024 and subsequent directions issued thereafter. However, despite repeated attempts over a considerable period of time and despite providing several opportunities to the market for participation, each of the auction processes failed due to complete absence of bids. The repeated failure of the auction proceedings over the years clearly establishes that there is no substantial interest from prospective purchasers and that further continuation of the process is unlikely to yield any fruitful result or meaningful recovery for the stakeholders.

It is stated that during the discussions held with Indian Bank, the status of the Personal Guarantor of the Corporate Debtor was also considered. In this regard, it was noted that the Personal Insolvency Resolution Process initiated against the Personal Guarantor has already culminated in discharge of the Resolution Professional appointed therein. This Bench, vide its order dated 17.03.2026 passed in IA/385(AHM)2026 in C.P.(IB)/121(AHM) 2025, discharged the Resolution Professional as no repayment plan was submitted by the Personal Guarantor within the prescribed framework. It is stated that the said development is relevant while considering the overall recovery mechanism available to the financial creditor and the prospects available under the Code.

Upon commencement of liquidation proceedings against the Corporate Debtor and initiation of bankruptcy proceedings against the Personal Guarantor by Indian Bank, there may arise an opportunity for submission of a joint resolution plan in accordance with Section 28A of the Insolvency and Bankruptcy Code, 2016. It is further submitted that Indian Bank has already filed Application for initiation of Bankruptcy under Section 123 of the Code on 13.06.2026.

Hence, by preferring IBC mechanism, it is stated that Liquidation of the Corporate Debtor at this stage would not prejudice the rights of any stakeholder but would instead facilitate adoption of the statutory mechanism contemplated under the Code for maximization of value and recovery in view of the commercial decision of the CoC, the repeated and unsuccessful attempts to sell the assets of the Corporate Debtor through auction, the absence of any viable resolution plan, and the circumstances relating to the Personal Guarantor, it is prayed to pass liquidation order.

Pursuant to direction mentioned in para-3 above by this Bench, the Applicant/RP submitted an affidavit of service to the Income Tax Department and the State Tax Department on 15.06.2026 vide inward diary no. D-4777 and submitted that the Applicant has served the notice through the speed post and dasti mode upon them. Ld. State Tax officer appeared in person through virtual mode and submitted that no dues or recovery proceedings are pending against the Corporate Debtor in the present matter on behalf of the State Tax Department.

We have heard the Learned Counsel for the Applicant, the Resolution Professional, the Learned Counsel for the Sole Member of CoC, the Indian Bank and the representative of the State Tax Department. We have also perused the record placed before us.

The Corporate Debtor was admitted into Corporate Insolvency Resolution Process by order dated 09.06.2025 passed under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Applicant was appointed as Interim Resolution Professional and was thereafter confirmed as the Resolution Professional by the Committee of Creditors. Public announcement was issued and claims were invited in accordance with the provisions of the Code and the Regulations.

The record shows that the Resolution Professional conducted the Corporate Insolvency Resolution Process in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016 and the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. Meetings of the Committee of Creditors were convened from time to time and the progress of the Corporate Insolvency Resolution Process was placed before the Committee of Creditors.

It is borne out from the record that Form G was issued on three occasions for inviting Expressions of Interest. Pursuant to the first and second process, only one Resolution Plan was received. The Committee of Creditors did not approve the Resolution Plan. Pursuant to the third process, no Resolution Plan was received within the prescribed period.

The Committee of Creditors also resolved to seek extension of the Corporate Insolvency Resolution Process. The period of the Corporate Insolvency Resolution Process was extended by order dated 10.12.2025.

The record further shows that in the 8th meeting of the Committee of Creditors held on 23.02.2026, the sole Financial Creditor holding 100% voting share resolved to liquidate the Corporate Debtor under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 and also resolved to appoint Mr. Rajesh Kumar Malani, Registration No. IBBI/IPA-001/IP-P-02098/2021-2022/13550, as the Liquidator under Section 34(1) of the Code.

This Tribunal, by order dated 06.05.2026, directed the Applicant and the sole member of the Committee of Creditors to place on record the justification as to how liquidation under the Insolvency and Bankruptcy Code, 2016 would be appropriate in comparison to proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Notice was also directed to be issued to the Income Tax Department and the State Tax Department.

In compliance with the said order, the sole Financial Creditor filed an affidavit stating that repeated attempts for sale of the assets of the Corporate Debtor through auction had failed and that no bidder had participated in such auctions. It was further stated that proceedings before the Debt Recovery Tribunal also did not result in sale of the assets despite repeated attempts. The affidavit further records that proceedings relating to the Personal Guarantor had also been taken into consideration and that liquidation under the Code was considered appropriate by the Committee of Creditors.

Section 33(2) of the Insolvency and Bankruptcy Code, 2016 provides that where the Resolution Professional, at any time during the Corporate Insolvency Resolution Process but before confirmation of a Resolution Plan, intimates the Adjudicating Authority of the decision of the Committee of Creditors approved by not less than sixty-six per cent of the voting share to liquidate the Corporate Debtor, the Adjudicating Authority shall pass a liquidation order.

The Hon'ble Supreme Court in the matter of K. Sashidhar Versus Indian Overseas Bank & Ors in Civil Appeal No. 10673 of 2018 has held that the commercial decision of CoC is non-justiciable. The material placed on record shows that the Committee of Creditors, having 100% voting share, resolved to liquidate the Corporate Debtor. No Resolution Plan approved under Section 30(4) of the Insolvency and Bankruptcy Code, 2016 has been placed before this Adjudicating Authority for approval under Section 31 of the Code. The decision of the Committee of Creditors satisfies the requirement of Section 33(2) of the Code.

In view of the resolution passed by the Committee of Creditors and the material placed on record, the application deserves to be allowed. Accordingly, delay of 01 day in filing the present application is condoned and the following order is passed: -

Accordingly, IA (Liq)/04/AHM/2026 in CP/141/AHM/2025 is allowed and stands disposed of.