In the matter of Phoenix Yarns Private Limited
- CitationCompany Petition (IB)-01-CHD-PB-2019
Ratio decidendi
The rule this decision rests on
Where a corporate person's voluntary liquidation has been completed, its affairs wound up, its assets fully liquidated, and no litigation is pending against it, with no objection from the Registrar of Companies or the Insolvency and Bankruptcy Board of India, the Tribunal may order the company dissolved from the date of its order under Section 59(7) of the Insolvency and Bankruptcy Code, 2016, read with the Voluntary Liquidation Process Regulations, 2017. Upon dissolution, the voluntary liquidator remains under a continuing obligation to preserve the records required to give a complete account of the voluntary liquidation process, and to preserve physical or electronic copies of the reports, registers and books of account referred to in Regulations 8 and 10 for at least eight years after the dissolution of the corporate person, either personally or with an information utility.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Section: 59(7) of IBC, 2016 read with IBBI (Voluntary Liquidation Process) Regulation, 2017
Judgement Delivered on: 24.04.2024
CORAM: SH. HARNAM SINGH THAKUR, HON’BLE MEMBER (J) SH. L. N. GUPTA, HON’BLE MEMBER (T)
PRESENT: For the Applicant : Mr. Arora Vishwas Kumar, Advocate
Judgement PER: SH. HARNAM SINGH THAKUR, MEMBER (J) & SH. L. N. GUPTA, MEMBER (T)
The present petition CP(IB) No.01/Chd/Pb/2019 is filed by the Applicant/Liquidator of the Corporate Person under Section 59(7) of the Company Petition No. ((IB)-01/CHD/PB/2019 Phoenix Yarns Private Ltd
IBC, 2016 read with Insolvency Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017 (for brevity, the “VLP Regulations”) with a prayer for dissolution of the Corporate Person namely, Phoenix Yarns Private Limited (for brevity, the ‘Company’).
2. Phoenix Yarns Private Limited is a Company incorporated on 12.08.2013 under the Companies Act, 2013 with CIN U17290PB2013PTC037821. The registered office of the company is situated a L.G.F. 66, City Palace, Chowri Sarak, Ludhiana, Punjab- 141008, falling within the territorial jurisdiction of this Tribunal.
3. It is stated by the Applicant that the Voluntary Liquidation Process (VLP) under the provisions of IBC, 2016 and VLP Regulations was commenced by the Company by passing a Special Resolution in the Annual General Meeting (AGM) of its members held on 27.06.2018, which is the date of voluntary liquidation commencement. It is further submitted that Mr. Rajeev Khurana, IP was appointed to act as Liquidator in the aforesaid AGM. Further, it is stated that as per Proviso to Section 59(3)(c) of the Code, the consent of the creditors representing more than 2/3rd in value was taken in this regard within 7 days of the said AGM. The scanned copy of the said Special Resolution is reproduced overleaf for a ready reference :
Company Petition No. ((IB)-01/CHD/PB/2019
Company Petition No. ((IB)-01/CHD/PB/2019
4. The Applicant has submitted that all the Directors of the Company have given Declarations of Solvency on Affidavits stating that “(i) A full inquiry was made into the affairs of the company and based on the inquiry the Director have formed an opinion that the Company has no debts as on 31.03.2018, (ii) The Company is not being liquidated to defraud any person.” The Affidavits of Declarations of Solvency by all the Directors are reproduced below, for the immediate reference:
Company Petition No. ((IB)-01/CHD/PB/2019 xxx xxx xxx xxx
Company Petition No. ((IB)-01/CHD/PB/2019
Company Petition No. ((IB)-01/CHD/PB/2019
5. It is further submitted by the Applicant that a certified copy of the said Special Resolution passed in the Annual General Meeting of the Members of the Company held on 27.06.2018 was filed by the Company with IBBI and ROC in Form MGT-14 on 03.07.2018 and 04.07.2018, respectively and Declaration of Solvency by the Directors as required under Section 59(3) of IBC 2016 in From GNL 2 on 04.07.2018.
6. It is stated that the Applicant then issued an advertisement for voluntary liquidation in “Form A-Public Announcement” in terms of Regulation 14 of the VLP Regulations 2017 in the Financial Express (English) and Rozana Spoksmen (Punjabi) Newspaper on 02.07.2018.
7. The Applicant has annexed the Financial Statements for the Financial Years ending 2017-18 with the application.
8. It is further stated by the Applicant that it had opened an account by the name of “Phoenix Yarns Private Limited (In Liquidation)” with Allahabad Bank, Chandigarh for the purpose of realisations and payments during the period of liquidation.
9. It is stated by the Applicant that it had submitted the Preliminary Report to the Company on 03.08.2018. The Applicant has submitted its Final Report dated 12.12.2018 in compliance of Regulation 38 of VLP Regulations giving details of the distribution of assets amongst the stakeholders. A copy of the Report is also stated to have been filed with the ROC. The relevant extracts of the Report reflecting Receipts and Payments of the company are reproduced below:
Company Petition No. ((IB)-01/CHD/PB/2019
10. The Applicant has submitted that it has paid off all the liabilities of the Company. The details of distribution as given in Form H, is reproduced below:
Company Petition No. ((IB)-01/CHD/PB/2019
11. It is further submitted by the Applicant through Form-H filed on 07.03.2024 vide diary no. 00872 that after the payment of Government
Company Petition No. ((IB)-01/CHD/PB/2019 dues and the surplus/residual amount to the members/equity shareholders of the Corporate Person, the bank account of the Corporate Person has been closed and thus, the liquidation process stood completed.
12. The ROC has filed its report on 16.05.2019 and has not raised any objection. The operative portion of the ROC’s Report is reproduced below, for the immediate reference:
“… it is to be stated that this office has no objection to dissolution of the subject company.”
13. IBBI filed its reply dated 26.04.2022 vide diary no. 01196/3 and has not raised any objections to the dissolution of the company.
14. On examining the Application, documents annexed therewith and the submissions made by the Voluntary Liquidator, it emerges that the affairs of the Company have been completely wound up, and its assets completely liquidated and there is no litigation pending against the Company.
15. In the light of the documents and facts placed on record, averments and the submissions made by the Applicant/Voluntary Liquidator, the Company deserves to be dissolved. Accordingly, this Tribunal directs that the Company shall be dissolved from the date of this Order.
16. The Petition stands Allowed accordingly.
Company Petition No. ((IB)-01/CHD/PB/2019
17. In terms of Regulation 41 Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017, the Applicant/ Voluntary Liquidator shall preserve copies of all such records, which are required to give a complete account of the voluntary liquidation process. Further, the Applicant/Liquidator shall preserve a physical or an electronic copy of the reports, registers and books of account referred to in Regulations 8 and 10 for at least eight years after the dissolution of the corporate person, either with himself or with an information utility.
18. The Applicant is directed to serve the copy of this Order upon the Registrar of Companies (ROC), with whom the Company is registered, within fourteen days of receipt of this Order. The ROC shall act as necessary upon receipt of a copy of this Order.
Sd/- Sd/- (L. N. GUPTA) (HARNAM SINGH THAKUR) MEMBER (T) MEMBER (J)
April 24, 2024 ASG
Company Petition No. ((IB)-01/CHD/PB/2019
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