Case Note & Summary
The appeal arose from an order of the National Company Law Tribunal (NCLT) directing the liquidation of Syska E-Retails LLP after the Corporate Insolvency Resolution Process (CIRP) period expired without an approved resolution plan. The CIRP commenced on 17.06.2025 following a petition by Canara Bank. Despite attempts to extend the CIRP period and receive a resolution plan, the Committee of Creditors (CoC) failed to secure the necessary 66% voting threshold for both extension and liquidation resolutions during meetings held on 10.12.2025 and subsequent meetings. The NCLT, on 08.01.2026, ordered liquidation under Section 33(1) of the Insolvency and Bankruptcy Code, 2016 (IBC), citing the expiry of the CIRP period and lack of an approved resolution plan. The appellant, a suspended partner of the corporate debtor, contended that there were ongoing expressions of interest for resolution and that the NCLT's order contravened the CoC's unanimous resolution to seek further directions. The respondents argued that the statutory framework mandated liquidation once the CIRP period expired without an approved plan. The Appellate Tribunal upheld the NCLT's order, emphasizing the statutory requirement for liquidation in the absence of a resolution plan and the failure of the CoC to extend the CIRP period. The court noted that the emergence of new expressions of interest did not alter the statutory position, and the decision for liquidation was consistent with the objectives of the IBC.
Headnote
A) Insolvency Law - Liquidation Order - Statutory Mandate for Liquidation - Insolvency and Bankruptcy Code, 2016, Section 33(1)(a) - The Adjudicating Authority was bound to order liquidation upon expiry of the CIRP period without an approved resolution plan, as per statutory requirements. The court held that the absence of a resolution plan and the failure to extend the CIRP period mandated liquidation (Paras 10, 47-49).
Issue of Consideration
Whether the Adjudicating Authority could defer liquidation after the expiry of the CIRP period without a resolution plan being received within the statutory period and without a valid extension.
Final Decision
The Appellate Tribunal upheld the NCLT's order for liquidation, emphasizing the statutory requirement for liquidation in the absence of a resolution plan and the failure of the CoC to extend the CIRP period.
Law Points
- Insolvency and Bankruptcy Code
- 2016
- Corporate Insolvency Resolution Process
- Liquidation
- Committee of Creditors
- Resolution Plan
- Voting Threshold
