Case Note & Summary
The review petition was filed by the Insolvency and Bankruptcy Board of India (IBBI) under Section 114 read with Order XLVII Rule 1 of the Code of Civil Procedure, 1908, seeking to review the order dated 15.06.2023 passed in WP No.12140/2023 by a Co-ordinate Bench of the High Court of Karnataka. The order under review directed the liquidator of Base Corporation Ltd. (BCL) to receive the balance sale consideration from M/s NDR Unique Space Pvt Ltd (NDR), the highest bidder in an e-auction conducted on 20.03.2023 for the Hosur unit of BCL, which was being sold as a going concern pursuant to liquidation proceedings. IBBI was not a party to the writ petition. The corporate insolvency resolution process of BCL was admitted by the National Company Law Tribunal (NCLT) on 02.08.2019, and upon the resolution plan not being accepted, liquidation was ordered on 26.04.2022, appointing Mr. Konduru Prashanth Raju as liquidator. The liquidator issued an e-auction notice on 13.02.2023, and NDR emerged as the highest bidder, depositing 25% of the bid amount. However, IBBI received a complaint alleging discrepancies in the auction, and an investigation was ordered. The investigation report found contraventions of the Insolvency and Bankruptcy Code, 2016, the Liquidation Process Regulations, 2016, and the Insolvency Professionals Regulations, 2016, including failure to properly constitute the Stakeholders Consultation Committee and appoint a qualified valuator. Consequently, IBBI suspended the liquidator for two years vide order dated 19.05.2023. The liquidator challenged the suspension before the High Court, obtaining an interim stay. Meanwhile, NDR filed WP No.12140/2023 seeking directions regarding the balance sale consideration. The Co-ordinate Bench disposed of the writ petition on 15.06.2023, directing the liquidator to accept the balance consideration, and a sale certificate was issued on 17.06.2023. IBBI initially approached the Supreme Court, which granted liberty to file a review petition. IBBI then filed the present review petition. During the pendency, the liquidator withdrew an appeal before the NCLAT, and IBBI issued a further show cause notice, which was also stayed by the High Court. The judgment text is incomplete and does not contain the court's analysis or final decision on the review petition, rendering the outcome unknown.
Issue of Consideration
Case Details
2025 LawText (KAR) (12) 26
Review Petition No.557/2023 in Writ Petition No.12140/2023
K.S. Mudagal, C.M. Poonacha
K. Arvind Kamath, Senior Advocate for Anupama Hegde, Lakshmi Menon, Dhyan Chinnappa, Senior Advocate for M.V. Sundara Raman
Insolvency and Bankruptcy Board of India
Mr. Konduru Prashanth Raju and M/s NDR Unique Space Pvt Ltd
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Nature of Litigation
Review petition filed by IBBI to review an order of a coordinate bench directing the liquidator to receive balance sale consideration from the auction purchaser in a liquidation process.
Remedy Sought
IBBI seeks review of the order dated 15.06.2023 passed in WP No.12140/2023.
Filing Reason
IBBI contends that the order under review was passed without considering its suspension of the liquidator and investigation into irregularities in the auction process.
Previous Decisions
The coordinate bench disposed of WP No.12140/2023 on 15.06.2023; IBBI's SLP against that order was disposed of by the Supreme Court with liberty to file review.
Judgment Excerpts
The present review petition is filed by Review Petitioner-Insolvency and Bankruptcy Board of India under Section 114 read with Order XLVII Rule 1 of the Code of Civil Procedure, 1908 seeking to review the order dated 15.06.2023 passed in WP No.12140/2023.
IBBI was not a party to the writ petition.
Vide order dated 19.5.2023, IBBI suspended respondent No.1 from the role of liquidator for a period of two years w.e.f., 30 days from that date.
The auction sale, pursuant to the sale notice dated 9.9.2021 was concluded on 19.10.2021 and a sale certificate dated 16.2.2022 was issued for a total sale consideration of ₹10,29,00,000 /-.
Respondent No.1 - liquidator issued a fresh e-auction notice dated 13.2.2023 for sale of the plant and machinery and building of the Hosur unit of BCL as a going concern, fixing the date of auction as 20.03.2023.
Procedural History
CIRP of BCL admitted by NCLT on 02.08.2019. Liquidation ordered on 26.04.2022, liquidator appointed. E-auction notice issued on 08.11.2022, withdrawn on 16.11.2022. Fresh e-auction notice on 13.02.2023, auction held 20.03.2023. NDR highest bidder, 25% deposit paid. Liquidator filed IA No.218/2023 on 05.04.2023. IBBI received complaint, investigation ordered; notice to liquidator on 12.04.2023, reply 20.04.2023. IBBI show cause notice 21.04.2023, reply 02.05.2023. IBBI suspended liquidator 19.05.2023. Liquidator filed WP No.11056/2023; stay granted 30.05.2023. NDR filed WP No.12140/2023, disposed 15.06.2023 directing liquidator to accept balance consideration. Sale certificate issued 17.06.2023. IBBI filed SLP, Supreme Court granted liberty on 06.09.2023. IBBI filed review petition. Liquidator withdrew NCLAT appeal on 26.04.2024. IBBI further show cause notice 11.07.2024, liquidator filed WP No.20276/2024, stay granted 29.07.2024.
Acts & Sections
- Code of Civil Procedure, 1908: Section 114, Order XLVII Rule 1
- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002:
- Insolvency and Bankruptcy Code, 2016: Sections 34, 60(5)
- Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016: Regulations 32A, 33, Schedule I Clause 1(12), Clause 13
- Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016: Schedule I
