Allowed

In the matter of Padmavati Intermediates Private Limited I.A. No. 354 of 2021 in C.P. (I.B) No. 807-9-NCLT-AHM-2019

NCLT16 Nov 2021

Case brief

AI extract

What is this about?

The NCLT Ahmedabad allowed an application for liquidation of M/s Padmavati Intermediates Pvt Ltd following a Committee of Creditors resolution. The court appointed the Resolution Professional as Liquidator, cancelled the moratorium, and issued directives regarding claim submission and proceedings transfer.

What did the court decide?

Order of liquidation passed; Appointment of applicant as Liquidator; Moratorium ceased; Claim submission deadline fixed at 30 days.

In the matter of Padmavati Intermediates Private Limited… — Insolvency and Bankruptcy | NCLT (2021)

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IN THE NATIONAL COMPANY LAW TRIBUNAL, AHMEDABAD COURT -¹

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ITEM No 42 |Al354(AHM)2021 in CP(IB) 807 of 2019

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Order under Section 33 |BC.2016

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IN THE MATTER OF:

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Darshan Bharatbhai Patel RP of Padmavati Intermediates Pvt Ltd

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........ Applicant

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........ Respondent

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Order delivered on ..16/11/2021

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Coram:

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Madan^B. Gosavi, Hon’ble Member(J) Ajai Das Mehrotra, Hon’ble Member(T)

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PRESENTS:

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For the Applicant For the IRP/RP For the Respondent

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ORDER

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The case is fixed for pronouncement of order.

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The order is pronouncedⁱⁿ open court vide separate sheet.

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(AJAI^DAS MEHROTRA) MEMBER(TECHNICAL)

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IN THE ADJUDICATING AUTHORITY NATIONAL COMPANY LAW TRIBUNAL AHMEDABAD BENCH COURT-1

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LA. No. 354 of 2021 IN

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C.P. (I.B.) No.807/9/NCLT/AHM/2019

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(Application^{underSection33} of^the Insolvency^and Bankruptcy Code, 2016)

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In the Matter of:

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Mr. Darshan Bharatbhai Patel Resolution Professional of, M/s Padmavati Intermediates Private Limited, Address at: 31, Vrindavan, Nr. Akshar Flat Inquilab Society,

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Gulbai Tekra, Ahmedabad- 380015

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...Applicant/^RP

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AND

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In the matter between:

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M/s Dipal Chemical Industries

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...Operational^Creditor

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Versus

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M/s Padmavati Intermediates Private Limited

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...C0rporate Debtor

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Order delivered on^16th November,^2021.

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Coram: Madan B. Gosavi, Member (Judicial) Ajai^Das Mehrotra, Member (Technical)

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IA 354(AHM)’2021 In CP (IB)807"2019

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Appearance:

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Mr. Kamal Lokhandwala counsel of Resolution Professional.

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@1113

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(Through^Video Conferencing)

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[Per: Ajai Das Mehrotra, Member (Technical)]

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The instant Application is filed by Mr. Darshan Bharatbhai Patel. Resolution Professional of Corporate Debtor M/s Padmavati Intermediates Pvt. Ltd., under Section 33 of the Insolvency and Bankruptcy Code,²⁰¹⁶ (hereinafter referred to as “Code”) for liquidation of the Corporate^Debtor.

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IQ This Adjudicating Authority,vide order dated 03.02.2021, had admitted the application filed by MS Dipal Chemical Industries under Section 9 of Code for initiation of Corporate Insolvency Resolution Process (‘CIRP’) of the Corporate Debtor^and appointed^Mr. Darshan Bharatbhai Patel as the Interim Resolution Professional (‘IRP’). Thereafter, Mr. Darshan Bharatbhai Patel was confirmed as Resolution Professional (‘RP’) in the^1SI COC meeting held on 09.03.2021.

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DJ . It^is evident^from the record thatⁱⁿ compliances of Section²¹ of Code read with Rule 6 & 8 of Insolvency and Bankruptcy Board of India (Insolvency^Resolution Process^for Corporate Persons) Regulations.

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IA 354(AHM)”2021 In CP (1B)807’2019

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2016 (hereinafter referred to as “CIRP Regulation"), the IRP constituted CoC .

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.^The CoC in the^3rd meeting held on 07.04.2021 discussed that as there are no assets^withthe Corporate Debtor, the chance of Resolution is rare.^Thus decided not to publish expression of interest and invite resolution plan. Thereby, the CoC in the^4th meeting held on 1 1.05.2021 had unanimously resolved to liquidate the Corporate Debtor and also resolved to appoint the Applicant herein Mr. Darshan Bharatbhai Patel bearing registration No. IBBI/lPA-OOl/lP-POl579/2018-19/12442 as a liquidator under Section³⁴ (4) of the Code. Further in accordance with Regulation^39D of^CIRP Regulations, liquidator’s fee was fixed to the tune of Rs. 40,000/- per month. Shri Rushi Dattani, being suspended management present^inthe4‘h meeting^{ofCoCstatedthathehas} no objection if the Corporate Debtor^is liquidated.

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.^We have carefully heard^and considered^the arguments of the learned counsel for the RP and have also perused the records. Taking into consideration the above facts in relation to the affairs of the Corporate Debtor, the provisions of Section³³ of Code are as follows:

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“33. Initiation ofliquidation.

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(I) Where the Adjudicating Authority, -

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(a) before the expiiy of the insolvency resolution process period or the maximum period permitted for completion of the corporate insolvency resolution process under section¹² or the fast-track

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A/fl/

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IA 354(AHM)/2021 In CP (IB)807’2019

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corporate insolvencv^resolution process^under section^56. as^the case may^{be.doesnot receive} a^resolution plan^{undersub-section(6)} of section 30;

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fb) rejects the resolution plan under section 3] for the noncompliance of^the requirements specified therein. it shall - (i) pass an order requiring the corporate debtor to be liquidated in the manner as laid down in this Chapter:

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(ii) issue a public announcement stating that the corporate debtor is in liquidation; and

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(iii) require such order to be sent to the authority with which the corporate^debtoris registered.

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(2) where the resolution professional at any time during the corporate^{insolvencyresolution} process^but before confirmation of resolution plan. intimates the adjudicating authority of the decision of^thecommittee of^creditor approved by not^less than sixtv-six percent of^the voting^shareto liquidate^the corporate^debtor.the Adjudicating Authority shall pass a liquidation order as referred to in sub-clause (i). (ii) and (iii) ofclause (b) ofSub—Section (1)^”

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The Hon’ble National Company Law Appellant Tribunal (‘NCLAT’).

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in Praveen Kumar Nand Kumar Vs. VSL Securities Pvt. Ltd. in CA No. —

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1/2020 in CA No. 308/2000, dated 09.06.2020, observed as under:

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“Likewise, the decision ofthe C0C recommending liquidation ofthe corporate^debtor after proper^evaluation of^the assets^{and liabilities} ofcorporate^{debtor with} no^{Resolution Plan} forthcoming^{would be} a business decisionfalling within the domain ofcommercial wisdom of the C0C which is not amenable tojudicial review.

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In View of the foregoing, we hereby pass the order of liquidation of the Corporate Debtor^M/s Padmavati Intermediates^Pvt. Ltd, consequently allow IA No. 354 of 2020 and issue following directions:

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1A 354(AHM)/2021 In CP (IB)807/2019

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1. The liquidation of the Corporate Debtor is effective from the date of this order and the Moratorium declared vide order dated 03.02.2021 in CP (IB) No.807/9/NCLT/AHM/202l, henceforth, ceases to exist.

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1. The CoC had resolved to appoint the RP as the Liquidator. It is noted that Applicant has failed to file its written consent to act as liquidator in prescribed form. Thus subject to filing of written consent to act as liquidatorⁱⁿ Form AA within five days from this Order, this Adjudicating Authority appoints Applicant / Resolution Professional Mr. Darshan Bharatbhai Patel (Registration No. IBBI/IPA-OOl/IP— P01579/2018-19/l2442) as a liquidator of the Corporate Debtor^i.e. M/s Padmavati Intermediates Pvt. Ltd. who shall complete the liquidation process as per the provision of Code read with Insolvency and Bankruptcy Board of India (Liquidation Process) Regulation, 2016.

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1. It^is noted that^the no resolution^is passed by CoC under Regulation 39B and 39C of CIRP Regulations, the liquidator is therefore directed to take necessary action in accordance with relevant regulations ofthe^IBBI (Liquidation Process) Regulations, 2016.

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1. As per Section 33(5) of the Code and subject to Section 52 of the Code, no suit or other legal proceedings shall be instituted by or against^the Corporate Debtor;

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Provided that a suit or other legal proceedings may be instituted by the Liquidator on behalf of the Corporate Debtor, with the prior approval of^the Adjudicating Authority;

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1. The provisions of sub-section (5) of Section 33 of the Code shall not apply to legal proceedingsⁱⁿ relation to such transactions as may be

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IA 354(AHM)/2021 In CP (IB)807/20l9

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Central Government in consultation with notified by the any financial sector regulator; and

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1. This order of liquidation under Section 33 of the Code shall be deemed to be a notice of discharge to the officers, employees and workmen of the Corporate Debtor, except when the business of the Corporate^Debtoris continued during the liquidation process by the Liquidator;^and

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1. All the 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 effectandshallbe} vested^{in the} Liquidator;^and

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1. The personnel of the Corporate Debtor shall extend all assistance and cooperation to^the Liquidator as may^be required by himⁱⁿ managing the affairs of the Corporate Debtor and provisions of Section 19 of the Code shall apply in relation to liquidation process as they apply in relation to CIR process with the substitution of references to the Interim Resolution Professional for references to the Liquidator.

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1. The Liquidator shall publish public announcement in accordance with Regulation 12 of the CIRP (Liquidation Process) Regulations, 2016 and in Form B of Schedule II of these Regulations within five days^from receipt of this order calling upon the stakeholders to submit their claims as on liquidation commencement date and provide^{thelastdateforsubmission} of^{claim whichshallbe30} days from the liquidation commencement date.

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10)The announcement shall^be publishedⁱⁿ accordance with Regulation 12(3) of^theCIRP (Liquidation Process) Regulation,^2016.

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IA 354(AHM)I2021 In CP (IB)807/2OI9

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11)Thatⁱⁿ accordance with Regulation¹³ of the CIRP (Liquidation Process) Regulations, 2016, the Liquidator shall file preliminary report^within75 days^andalsofile regular progress reports as per Regulation^15.

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12)It^is seen that IA No. 295/2021 and IA 511/2021 filed under Section 60(5)^and43& 44 of the Code respectively are pending. The said IAs have bearing on the issues in liquidation proceedings, they are directed to be listed along with the CP No. 807/9/JPR/2019 when the matter^is next placed before this Adjudicating Authority. If so advised, the liquidator may move appropriate applications^for prosecution of^thesaid applications by a suitable person / entity instead of the RP and the Liquidator is not precluded from carrying on the^said proceedings.

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13)Registry^{is directed} to upload this order on the official website within maximum two working days from the date of this order. The authenticated copy of this order also be sent by the registry to the Financial Creditor, Corporate Debtor, Registrar of the Company, Resolution Professional and Liquidator by Speed-post within one week from this order.

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