Arsenius Skill Capital Vs TV Producsts India Private Limited

Anil Raj Chellan, Member Technical

It is an application filed u/s 33 (1)(a) , 34 of the Insolvency & Bankruptcy Code, 2016 (Code) by Mr. Manish Shah (RP) of TV Products India Private Limited seeking liquidation order based on the resolution passed by the Committee of Creditors (CoC) in its 3rd meeting held on 20.04.2022 with a requisite majority as contemplated under Code, 2016.

On perusal of this application, it appears that this Company Petition (IB)-2299(MB)/2018 was admitted by this Tribunal on 23.11.2021 and the Applicant herein was appointed as IRP and subsequently was appointed as Resolution Professional in the 1st CoC meeting held on 22.12.2021.

Pursuant thereto, Form A was published by the Applicant on 29.11.2021 in newspapers namely, Financial Express (English Edition) and Navrashtra (Marathi Edition) inviting claims. Further, the Applicant constituted the CoC in accordance with Section 21 of the Code.

The Applicant states that no claims were received from the Financial Creditors. As there were no Financial Creditors, the CoC was formed only with 2 Operational Creditors. The Applicant also intimated about the initiation of CIRP to the statutory authorities viz. Income Tax, ESIC and Provident Fund thereby their inviting claims. However, no claims had been received. Also, there were no claims received from the employees/workmen as well.

The Applicant appointed two registered valuers to value the securities and Financial Assets of the Corporate Debtor and the same was placed before the 2nd CoC meeting held on 02.02.2022.

The Applicant published form G on 07.02.2022 inviting EoI from the prospective Resolution Applicants and the last date of the receiving EoI was on 09.03.2022. No EoI was received from any prospective Resolution Applicant.

The Applicant states that the Corporate Debtor has no fixed assets, no business activities and no employees in the Company. With the help of the suspended Board of Directors, the Applicant had made recoveries made on loans and advances being Rs. 73,000/- and Rs. 34,500/-. The Applicant has stated that further recoveries would be made during the course of liquidation process.

In the 3rd CoC meeting held on 20.04.2022 as no EoI had been received in response to Form G and as there was no business activities of the Corporate Debtor, the CoC unanimously passed the Resolution for liquidation of the Corporate Debtor and also passed the Resolution for the appointment of the Applicant RP, as the liquidator of the Corporate Debtor.

The relevant extract of the resolution passed in 3rd CoC meeting held on 20.04.2022 is as follows:

“RESOLVED THAT, pursuant to section 33(1)(a) of the Insolvency and Bankruptcy Code, 2016 and other applicable provisions, the Committee of Creditors hereby resolve to liquidate the Corporate Debtor, namely TV Products India Private Limited.

“RESOLVED FURTHER THAT, the Committee hereby authorizes Mr. Manish Shah, Resolution Professional to file an application with Hon'ble NCLT Mumbai Bench and do all such acts, deeds and things as may be necessary to give effect to this resolution.”

The Applicant stats that the CIRP costs of Rs. 7,12,767/- was approved by the CoC by passing the following Resolution :-

“RESOLVED THAT an amount of Rs. 7,12,767/- incurred till the date of this notice be and hereby approved as Insolvency Resolution cost.

“RESOLVED FURTHER THAT the committee hereby agrees to reimburse the said amount by debiting the bank accounts maintained by the Corporate Debtor and authorize Mr. Manish Shah, Resolution Professional to do all acts, deeds and matters as maybe necessary to give effect to this Resolution”.

The CoC has also approved the fee of the liquidator for a lumpsum amount of Rs. 4,00,000/- excluding applicable taxes and out of pocket expenses. The members of the CoC also approved to contribute to the estimated liquidation cost being Rs. 5,50,000/-.

Looking at the application and averments, we are of the considered opinion that this is a fit case for liquidation, therefore, we hereby order for the liquidation of the company with directions as follows:

a. The Mr. Manish Shah, holding Registration No. IBBI/IPA-001/IP-P00094/2017-2018/10194, is appointed as the Liquidator in terms of Section 34 of the Code;

b. Registry is directed to communicate this Order to the concerned Registrar of Companies, and to the Insolvency and Bankruptcy Board of India;

c. The Order of Moratorium passed under Section 14 of the Insolvency and Bankruptcy Code, 2016 shall cease to have its effect and a fresh Moratorium under Section 33(5) of the Insolvency and Bankruptcy Code shall commence;

d. This order shall be deemed to be a notice of discharge to the officers, employees and the workmen of the corporate debtor as per Section 33(7) of the Insolvency and Bankruptcy Code, 2016;

e. The Liquidator is directed to proceed with the process of liquidation in a manner laid down in Chapter III of Part II of the Insolvency and Bankruptcy Code, 2016 and in accordance with the relevant rules and regulations.

f. The Liquidator shall follow up and continue to investigate the financial affairs of the Corporate Debtor in accordance with provisions of Section 35(1) of the Code.

g. The liquidator shall also follow up the pending applications for their disposal during the process of liquidation including initiation of steps for recovery of dues of the Corporate Debtor as per law.

h. The Liquidator shall submit a Preliminary Report to the Adjudicating Authority within seventy-five days from the liquidation commencement date as per Regulation 13 of the Insolvency and Bankruptcy (Liquidation Process) Regulations, 2016;

i. Copy of this order be sent to the financial creditors, corporate debtor, the Liquidator for taking necessary steps.

The IA-1234/2022 filed by the RP for Liquidation of the Corporate Debtor is hereby allowed in the aforesaid terms