Allowed

In the matter of Lakshmi Apparels & Wovens Limitied [I.a (IBC)-1112 (Che)- 2023 in MA-132-2018 in TCP-262-IB-2017]

NCLT23 Feb 2024I.A (IBC)-1112 (CHE)- 2023 in MA-132-2018 in TCP-262-IB-2017

Case brief

AI extract

What is this about?

The NCLT Division Bench allowed the liquidator's application to dissolve M/s. Lakshmi Apparels & Wovens Limited. The court found that all assets were liquidated, the liquidation account was closed with zero balance, and funds distributed to stakeholders. The company was ordered dissolved based on Section 54 of the IBC.

What did the court decide?

Dissolution of M/s. Lakshmi Apparels & Wovens Limited ordered. Liquidator directed to forward a copy of this Order to the Registrar of Companies and IBBI within 7 days.

In the matter of Lakshmi Apparels & Wovens Limitied [I.a… — Insolvency and Bankruptcy | NCLT (2024)

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IN THE NATIONAL COMPANY LAW TRIBUNAL, DIVISION BENCH – II, CHENNAI I.A (IBC) / 1112 (CHE) / 2023

MA/132/2018

TCP / 262 / IB / 2017

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(Filed under Section 54(1) of the Insolvency and Bankruptcy Code, 2016 and Regulation 45 of the IBBI (Liquidation Process Regulations), 2016 read with Rule 11 of the National Company Law Tribunal Rules, 2016)

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In the matter of M/s. Lakshmi Apparels & Wovens Limited (IN LIQUIDATION)

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M. SURESH KUMAR

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Liquidator of M/s. Lakshmi Apparels & Wovens Limited (In Liquidation), (Regn. No. IBBI/IPA-001/IP-P00110/2017-18/10217) SPP & Co, Nivedh Vikas, Pankaja Mill Road, Puliyakulam, Coimbatore, Tamil Nadu – 641 045.

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… Applicant / Liquidator

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Order Pronounced on 23^rd February 2024

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CORAM

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SHRI. JYOTI KUMAR TRIPATHI, MEMBER (JUDICIAL) SHRI. RAVICHANDRAN RAMASAMY, MEMBER (TECHNICAL)

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(Through Virtual Hearing)

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Present: -

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For Applicant : A.G. Sathyanarayana, Advocate

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ORDER

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The present Application has been filed under Section 54(1) of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as ‘Code’) and Regulation 45(3) of IBBI (Liquidation Process Regulations), 2016 (hereinafter referred to as ‘Regulations’) r/w Rule 11 of NCLT Rules, 2016 (hereinafter referred to as ‘Rules’) by the Liquidator seeking an order of dissolution of M/s. Lakshmi Apparels & Wovens Limited , having CIN: U18101TZ1991PLC003195 and Registered office at No. 10/400, Palghat

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 1 OF 11

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Road, Kuniamuthur, Coimbatore, Tamil Nadu, India – 641 008 (hereinafter referred to as ‘Corporate Debtor’ ).

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It is stated that CIRP in respect of the Corporate Debtor was initiated on 01.09.2017 in TCP/262/(IB)/CB/2017. Liquidation of the Corporate Debtor was ordered by this Tribunal vide order dated 22.06.2018 in MA/132/IB/2018 in TCP/262/(IB)/CB/2017 and the Applicant herein was appointed as the Liquidator.

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It is stated that pursuant to the Liquidation order the Applicant made a public announcement on 27.06.2018 in Daily Newspapers namely ‘Times of India, Coimbatore Edition’ (English) and ‘Hindu Tamil Thisai’ (Tamil). The last date for submission of the claim before the Applicant was fixed as 21.07.2018.

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It is stated that the Applicant had received three claims. The details of

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the claims received and admitted are as follows:

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It is stated that a Bank Account in the name of ‘ M/s. Lakshmi Apparels & Wovens Limited – Liquidation Account’ bearing A/c No.

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 2 OF 11

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1141102000007184 was opened on 03.08.2018 with IDBI Bank, RS Puram branch, Coimbatore – 641 002.

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It is stated that as per Regulation 13 of the Liquidation Regulation, the Preliminary Report and the Asset memorandum was filed within 75 days from the Liquidation Commencement date on 03.09.2018.

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In order to assess the value of assets (Land, Building and Plant & Machinery) of CD liquidator appointed two registered valuers on 24.07.2018.

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As per Regulation 34, the Asset Memorandum which is filed shows

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the Liquidation value is valued around Rs.4,24,00,000 and Rs. 4,32,35,847 as

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follows,

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On 07.09.2023, the SCC in its meeting discussed and approved the

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Mode of sale, Fixation of Reserve Prize, EMD requirements, Payment Terms,

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other terms and conditions of sale in respect of assets forming part of the

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Liquidation estate.

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 3 OF 11

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Subsequently, applicant issued public sale notices on dailies namely Indian Express (English) and Dinamani (Tamil) dated 02.10.2018, 19.11.2018 and 09.10.2020. The assets were sold vide E-autions where M/s. Devi Thread Processors Pvt Ltd and Sri Ragavendra Real estate came out as successful bidder. Sale certificate to that effect was also issued after realizing the bid

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amount in complete. Details of sale are extracted as below,

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 4 OF 11

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It is stated that that total amount of Rs.13,03,68,568/- (Rupees thirteen

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crore three lakh sixty eight thousand five hundred and sixty eight only) has been realized through the liquidation process and same has been realized to the Stakeholders as per the provisions of the Code.

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The details of realization has been extracted as below,

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 5 OF 11

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It is also stated that no applications are pending before this Tribunal

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regarding PUFE transactions.

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It is stated that the Liquidation process was not completed in actual timelines and process has been extended till 05.04.2023 vide Order dated

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06.01.2022 in IA/914/IB/2020 in IA/132/IB/2018 in TCP/262/IB/CB/2017 and Order dated 29.11.2022 in IA(IBC)/1246(CHE)/2022 in TCP(IB)/262(CHE)2022 due to various reasons and circumstances. The entire timeline of the Liquidation Process of this CD is extracted as follows,

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 6 OF 11

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Further, it is stated that the receipts and payment of the Liquidator

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during the Liquidation process have also been audited.

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Heard the submissions made by the Learned Counsel for the

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Applicant and perused the documents on record.

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Section 54 of the IBC, 2016 provides as follows: -

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"Section 54

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(1) Where the assets of the corporate debtor have been completely

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liquidated, the liquidator shall make an application to the Adjudicating Authority for the dissolution of such corporate debtor.

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(2) The Adjudicating Authority shall on application filed by the liquidator under sub-section (1) order that the corporate debtor shall be dissolved from the date of that order and the corporate debtor shall be dissolved accordingly.

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(3) A copy of an order under sub-section (2) shall within seven days from the date of such order, be forwarded to the authority with which the corporate debtor is registered."

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Regulation 14 of the IBBI (Liquidation Process) Regulation 2016 reads as follows,

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"Regulation 14: Early dissolution.

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 7 OF 11

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Any time after the preparation of the Preliminary Report, if it appears to the liquidator that-

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(a) the realizable properties of the corporate debtor are insufficient to cover the cost of the liquidation process; and

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(b) the affairs of the corporate debtor do not require any further investigation;

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he may apply to the Adjudicating Authority for early dissolution of the corporate debtor and for necessary directions in respect of such dissolution."

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Regulation 45 of the IBBI (Liquidation Process) Regulation 2016 reads as follows,

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"Regulation 45: Final report prior to dissolution.

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(1) When the corporate debtor is liquidated, the liquidator shall make an account of the liquidation, showing how it has been conducted and how the corporate debtor’s assets have been liquidated.

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(2) If the liquidation cost exceeds the estimated liquidation cost provided in the Preliminary Report, the liquidator shall explain the reasons for the same.

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(3) The liquidator shall submit an application along with the final report and the compliance certificate in form H to the Adjudicating Authority for –

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(a) closure of the liquidation process of the corporate debtor where the corporate debtor is sold as a going concern; or

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(b) for the dissolution of the corporate debtor, in cases not covered under clause (a).

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The amounts realized from the liquidation of the assets of the corporate debtor had been fully distributed. The IDBI Bank letter dated 21.11.2023, filed dated 21.11.2023, shows that the liquidation account of CD has been closed on 21.11.2023. The balance of the bank account was marked as zero balance as on 27.02.2023 and the same is extracted hereunder,

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 8 OF 11

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 9 OF 11

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The final report and the Compliance Certificate filed in Form-H by the Applicant shows the amount distributed under the liquidation process and same is recorded as follows,

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IA (IBC) / 1112 (CHE) / 2023 in MA / 132 / 2018 in TCP/262/IB/2017 In the matter of M/S. LAKSHMI APPARELS & WOVENS LIMITED (IN LIQUIDATION)

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PAGE 10 OF 11

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It is thus seen that the Corporate Debtor has been completely liquidated. In the above circumstances, this Tribunal finds it necessary to order for the dissolution of the Corporate Debtor as per Section 54 of the Code.

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Accordingly, we order the dissolution of the Corporate Debtor viz ., M/s. Lakshmi Apparels & Wovens Limited . The Liquidator is directed to forward a copy of this Order to the RoC concerned and also to the IBBI for its records and for updating the status of the Corporate Debtor on the ‘MCA – Master data’ within a period of 7 days from the date of this Order.

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