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In the matter of Lumex Resources Pvt. Ltd. [Ia. (Ib) No. 280/CB/2022 in Cp (Ib) No. 180/CB/2020]

NCLT10 Jan 2023IA. (IB) No. 280/CB/2022 in CP (IB) No. 180/CB/2020

Case brief

AI extract

What is this about?

The Tribunal disposed of an application for liquidation against a corporate debtor found to have nil assets. The court ordered the dissolution of the company without initiating a formal liquidation process, citing futility and lack of assets.

What did the court decide?

Ordered dissolution of the Company with immediate effect without liquidation; directed registry to forward order to RoC and Statutory Authorities.

In the matter of Lumex Resources Pvt. Ltd. [Ia. (Ib) No… — Insolvency and Bankruptcy | NCLT (2023)

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IN THE NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH CUTTACK

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IA. (IB) No. 280 /CB/2022 In

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CP (IB) No. 180/CB/2020

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In the Matter of:

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Application Under Section 33 & 34 of the Insolvency and Bankruptcy Code, 2016 for an order of liquidation against the corporate debtor .

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In the Matter of:

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Suresh Chandra Pattanayk, Resolution Professional of Lumex Resources Pvt. Ltd, having office at- Gk V-38, Gati Krushna Villa, Tankapani Road, Bhubaneswar, Odisha

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…Applicant -In- In the Matter of: Nisharani Mahapatra, …Financial Creditor Financial Creditor -VersusLumex Resources Pvt Ltd,

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…Financial Creditor Financial Creditor

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…Corporate Debtor Appearances (through video conferencing ) For the Applicant : Mr. Suresh Chandra Pattanyak, RP Order reserved on: 12.12.2022 Order pronounced on: 10.01.2023 Coram: Shri P. Mohan Raj : Member (Judicial) Shri Satya Ranjan Prasad : Member (Technical)

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IN THE NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH

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IA. (IB) No.280 /CB/2022

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CP (IB) No. 180/CB/2020

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O R D E R

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Per P. Mohan Raj, Member, (Judicial)

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This Application has been filed by, Mr. Suresh Chandra Pattanayak,

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Resolution Professional of corporate debtor Lumex Resources Pvt Ltd. The Corporate Insolvency Resolution Process (CIRP) against the corporate debtor under Section 7 of IBC, 2016 was admitted by this Adjudicating Authority on 08.10.2021. The applicant was appointed as an Interim Resolution Professional, subsequently, the applicant was appointed as Resolution Professional in the 1^st COC meeting held on 15.11.2021 and approved by this Adjudicating Authority by order dated 03.06.2022 passed in I.A.(IB) No.95/CB/2022.

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In pursuance of CIRP order the IRP effected public announcement in English daily Business Standard and Vernacular daily The Samaj both on 11.10.2022. In response to the said newspaper publications no claims have been received.

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The Applicant visited the industrial premises of the Corporate Debtor on 10.10.2022. it is stated that when the applicant’s team made a visit, the office premise of the corporate debtor was closed. Further, it seemed that no operational or manufacturing activities were carried on by the Suspended Board in the Industrial premises of the Corporate Debtor.

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On 13.10.2021, suspended director Mr. Rajeev Dash replied that he is travelling and will come back on 18.10.2021. He came to the office of IRP on 18.10.2021 and informed that his office is locked by the landlord because of non-

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IN THE NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH

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IA. (IB) No.280 /CB/2022 CP (IB) No. 180/CB/2020

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payment of rent and all his books of account are lying inside. IRP made a request to the landlord to open the office so that corporate debtor can take his books of accounts and then handover IRP after completion. The Landlord agreed and opened the office on 23.10.2021 for one hour and CD took all files and hard disk of Tally and assured IRP that within 3 days he will handover complete books of Accounts.

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It is stated that the Committee of Creditors was provisionally constituted by the Applicant on 01.11.2021 with Mrs. Nisharani Mahapatra as the sole member of the Coc. The First Coc meeting was held on 15.11.2021 wherein the Coc approved the appointment of the Applicant as the Resolution Professional.

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The Corporate debtor did not handover completed books of accounts or possessions of the company after multiple follow-up by the IRP. Then IRP filed an application for direction from this Hon’ble Authority under Section 19 (2) of IBC on 12.11.2021.

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It is pertinent to mention that the Suspended Board of Directors of the Corporate Debtor preferred an appeal before the Hon’ble NCLAT, Delhi against the order passed by this Tribunal dated 08.10.2021. The Hon’ble NCLAT, vide Company Appeal (AT) (Insolvency) No. 10 of 2022 dated 11.03.2022, dismissed the appeal filed by the Suspended Board stating that no one appeared for the 5^th time.

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The second meeting of Coc was held on 25.03.2022. the member of the Coc directed the Applicant to file extension of CIRP time period under Section 12 (2) of IBC 2016, accordingly RP filed time Extension petition on 04.04.2022.

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IN THE NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH

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IA. (IB) No.280 /CB/2022 In CP (IB) No. 180/CB/2020

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This Hon’ble Tribunal heard the matter on 15.03.2022. The RP submitted the list of documents required on 23.03.2022 and the final order was pronounced on 26.04.2022 by directing the corporate debtor to co-operate with R.P and given liberty to RP to use his best judgement.

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It is stated that as a consequence of the Order, RP requested financial creditor to provide fund for Statutory audit and Forensic Audit. IRP had already appointed Forensic Auditor after the 1^st Coc. Forensic Auditor has submitted draft report on 30.06.2022 and demanded fee so that he will be able to submit final Audit report. But financial creditor said that all bank accounts are frozen by Police in a criminal matter of her husband. Even RP and his counsel were not been paid their fees since December, 2021.

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Further, extension for time period was heard on 01.062022 by this Authority and Order was pronounce on 03.06.2022 by allowing extension for 90 days.

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Thereafter, the RP called for 3^rd Coc to be held on 31.05.2022. Meanwhile RP came to know that Financial Creditor is related party to one of the Suspended Director. However, Financial Creditor had given an undertaking that she is not related party to Corporate Debtor. RP wants to re-confirm the status of financial creditor, so the Coc scheduled to be held on 31.05.2022 was cancelled.

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The applicant has not realised any Asset of the Company. Even Suspended Director had filed an affidavit before this Authority during the proceedings under Section 19 (2) that all furniture and fixtures of the office had been already acquired by the landlord towards default of rent payments prior to

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IN THE NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH

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IA. (IB) No.280 /CB/2022 In CP (IB) No. 180/CB/2020

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initiation of CIRP. Therefore, the Liquidation Value of the Company is Nil. In the circumstances this application for liquidation has been filed.

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The applicant expressed that he is unwilling to act as Liquidatior. if the Liquidation is ordered.

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Even though this application is filed for an order of Liquidation of Corporate debtor, but in the application it is clearly mentioned that the company has Nil Liquidation value. Further the Financial creditor who happened to be related party to the corporate debtor not forth come to meet the bare minimum expenses of CIRP. No fee has been paid to the R.P, Rs. 8,58,252/- as on 30.06.2022; Advocate fee Rs. 2,64,000/- and forensic Auditors fee Rs. 50,000/-. At this juncture appointing new person as a Liquidator is quite not possible without any payment towards renumeration and it will not serve the purpose. The facts and circumstances of the case justify that there would be no useful purpose be served by placing the corporate debtor under a Liquidation Process; it will be only a ceremonial order, since there is NIL Assets to the Company and there is no outstanding receivable dues, it appears that it is just and necessary to dissolve the corporate debtor without undergoing liquidation process. The NCLT- Bengaluru in M/s Synew Steel Private Limited by order dated 16.11.2020 in IA No. 435/2020 ordered dissolution of company without ordering Liquidation holding that the Liquidation Process deemed to have been completed.

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In the result, by exercising powers conferred on the Adjudicating Authority, under Section 54 R/w Rule 11 of NCLT Rules, 2016 and other relevant

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IN THE NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH

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IA. (IB) No.280 /CB/2022 In CP (IB) No. 180/CB/2020

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and connected Provisions of Code, and the Rules made thereunder, IA (IB) No. 280/CB/2022 are hereby disposed of with the following directions:

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(1) The Applicant Company, Lumex Resources Private Limited is ordered to be dissolved with immediate effect.

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(2) The Registry is directed to forward a copy of this order to the Registrar of Companies, Cuttack, Odisha, within a period of two weeks from the date of this order.

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(3) The Resolution Professional is also directed to forward copies of the order to all other Statutory Authorities including IBBI, connected with the affairs of the company.

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(4) Personal liability/Guarantee of any Director/Promoter of the Corporate Company, if any, would not absolve them of their liability by Virtue of this order. Aggrieved party/parties, if any, shall be at liberty to continue or to take appropriate legal recourse against them.

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(5) No order as to costs.

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SATYARANJAN PRASAD Digitally signed by SATYARANJAN PRASAD Date: 2023.01.10 16:11:18 +05'30' Digitally signed by PANDIAN MOHAN PANDIAN MOHAN RAJ RAJ Date: 2023.01.10 14:20:20 +05'30' Satya Ranjan Prasad P. Mohan Raj Member (Technical) Member (Judicial)

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Signed on this 10^th day of January, 2023.

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Supriya_P.S.

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In the matter of Lumex Resources Pvt. Ltd. [Ia. (Ib) No. 280/CB/2022 in Cp (Ib) No. 180/CB/2020]

Case brief

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In the matter of Lumex Resources Pvt. Ltd. [Ia. (Ib) No. 280/CB/2022 in Cp (Ib) No. 180/CB/2020]

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