Vishal Harish Choudhary vs Arihant Nenawati

Vishal Harish Choudhary (Suspended Director of Corporate Debtor) ...Appellant

Versus

Arihant Nenawati Liquidator of M/s Royal Refinery Private Ltd. ...Respondent

Present: For Appellant: Mr. Nishant Bishnoi, Mr. Saurabh Ajay Gupta and Ms. Srishti Prabhakar, Advocates. For Respondent: Mr. Kaustav Som and Mr. Arjun Krishnan, Advocates for Liquidator.

ORDER

(Virtual Mode)

12.04.2022: Heard learned counsel for the Appellant. This Appeal has been filed against order dated 16.04.2021 passed by the Adjudicating Authority by which order the Adjudicating Authority has allowed the Application filed by the Resolution Professional for liquidation of the Corporate Debtor.

2. Learned counsel for the Appellant challenging the order contends that Appellant was prejudiced since there was only one Financial Creditor in the CoC having 100% voting share, hence, the entire CoC was controlled by one Financial Creditor. It further submitted that the Suspended Directors were also not given opportunity by the Adjudicating Authority before passing order for liquidation.

3. We have considered submissions of learned counsel for the Appellant and perused the record.

4. The CIRP was initiated against the Corporate Debtor by order dated 13.11.2019. After receipt of the claim, CoC was constituted. In 6th CoC meeting held on 10.09.2020, CoC took view that sale of the Corporate Debtor

Cont'd.../ -2-

is not possible as it is not a going concern and decided that sale of Corporate Debtor cannot be done as a going concern and by 100% voting share of the CoC resolution for liquidation was approved. The said factum has been clearly noticed in the Para 7 of the order of the Adjudicating Authority. The IRP then filed application as per provisions of Section 33 of the Code, which has been allowed by the impugned order.

5. The mere fact that CoC is constituent of only one Financial Creditor which has 100% voting share cannot be said to be a ground on which the Appellant can question order of liquidation. Decision for liquidation has been taken with 100% voting share of the Financial Creditor as has been noted by the Adjudicating Authority. Further, the submission of the Appellant that the Suspended Directors were entitled to given opportunity by the Adjudicating Authority before passing the order of liquidation has also no substance. The Adjudicating Authority passed the order on the Application of the Resolution Professional after hearing the Financial Creditor. We do not find any error in the order of the Adjudicating Authority directing for liquidation of the Corporate Debtor. There is no merit in the Appeal. The Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Dr. Alok Srivastava] Member (Technical)

[Shreesha Merla] Member (Technical) Archana/nn

Company Appeal (AT) (Insolvency) No. 170 of 2022