Stakeholders Consultation Committee of Shree Mahalaxmi Corporation Private Limited Vs Debdas Chakraborty (NCLT Kolkata)
Summary: The National Company Law Tribunal, Kolkata, allowed an application filed by the Stakeholders Consultation Committee (SCC) of Shree Mahalaxmi Corporation Private Limited, through State Bank of India, seeking replacement of the existing liquidator, Mr. Debdas Chakraborty, with Mr. Vijender Sharma. The corporate insolvency resolution process had commenced pursuant to an order dated 23 February 2024, and the respondent had been appointed liquidator on 20 June 2025. At its second meeting on 16 September 2025, the SCC unanimously approved the replacement with 100% voting support. The stated reason was that a common liquidator would facilitate effective handling of the liquidation proceedings of three connected group companies.
The applicant submitted that the proposed liquidator was already handling the liquidation of Shree Padmavati Metaliks Private Limited and Ambay Coke Industries Private Limited. These companies had common erstwhile promoters and directors with the corporate debtor and several cross transactions between them. His written consent in Form AA and authorisation for assignment were placed on record. The applicant also stated that the respondent had not accepted the reduced fees proposed by the SCC and that outstanding expenses, including the liquidator’s fees, had been paid pursuant to the Tribunal’s earlier direction dated 5 December 2025.
The respondent challenged the maintainability of the application and alleged abuse of process. He contended that the proposal to replace him had been approved at the same SCC meeting at which his fees were discussed, without recording grounds for replacement, contrary to Regulation 31A of the Liquidation Process Regulations. He further alleged that SCC members had impeded the liquidation process through non-cooperation, repeated adjournments, failure to attend meetings and failure to deliberate on critical agenda items.
The Tribunal noted that Regulation 31A had subsequently been omitted by the IBBI (Liquidation Process) (Fourth Amendment) Regulations, 2026, but held that it had jurisdiction to adjudicate the application filed on 25 September 2025. It accepted that the connected transactions and businesses of the three companies made a common liquidator efficient. Referring to Regulation 31A(11), it identified the requirements of approval by at least 66%, valid written consent of the proposed liquidator and an application before the Adjudicating Authority. It also reproduced the newly inserted Section 34A of the Insolvency and Bankruptcy Code, concerning replacement of a liquidator by the committee of creditors.
Finding that the replacement had received unanimous SCC approval, that the proposed liquidator had furnished written consent and that no disciplinary proceedings were pending against him, the Tribunal approved Mr. Vijender Sharma’s appointment as the new liquidator. It directed the outgoing liquidator to hand over charge of the corporate debtor’s entire documents to the incoming liquidator and allowed and disposed of the application.
FULL TEXT OF THE ORDER OF NCLT KOLKATA
1. This present Interlocutory Application has been filed by the Applicant under Section 60(5) of the Insolvency and Bankruptcy Code, 2018 (for short ‘the Code’) seeking directions to replace the Respondent Liquidator for the ongoing liquidation of Shree Mahalaxmi Corporation Private Limited, the Corporate Debtor.
2. The Applicant is the Stakeholders Consultation Committee (hereinafter being referred to as ‘SCC’) of the Corporate Debtor, represented by one of the members, the State Bank of India. The Corporate Insolvency Resolution Process (for short ‘CIRP’) was initiated against the Corporate Debtor by this Tribunal in C.P. (I.B.) 130/KB/2022, vide an order dated 23.02.2024. A copy of the dated 23.02.2024 is annexed as Annexure A.
3. The Respondent, Mr. Debdas Chakraborty, is the present Liquidator for the ongoing liquidation of Shree Mahalaxmi Corporation Private Limited, appointed by this Tribunal vide an order dated 20.06.2025 while considering the Circular No. 12011/214/2023-IBBI/840, dated 18.07.2023, issued by the Insolvency and Bankruptcy Board of India. A copy of the order dated 20.06.2025 is annexed as Annexure B.
4. It is submitted that on 16.09.2025, the SCC held its 2nd meeting where it resolved, by a unanimous decision backed by 100% voting by the members of the SCC, to replace the Respondent by Mr. Vijender Sharma, Registration No. IBBI/IPA-003/IP-N00003/2016-2017/10022. It is also stated that the resolution was noted by the Liquidator and the same would be put up before this Tribunal for consideration and directions. The relevant portion of the Minutes of the SCC Meeting dated 16.09.2025, a copy of the same is annexed as Annexure D, is reproduced below:
“ITEM NO.10: PROPOSAL FOR REPLACEMENT OF THE EXISTING LIQUIDATOR AND NOMINATION OF A NEW LIQUIDATOR: The representative of State Bank of India (SBI), a member of the Stakeholders’ Consultation Committee (SCC), proposed that a common Liquidator would be appropriate for the holistic and effective resolution of the liquidation proceedings of the Corporate Debtor. And hence, the current Liquidator, Mr. Debdas Chakraborty, appointed by the Hon’ble National Company Law Tribunal (NCLT), Kolkata Bench – II, be replaced.
………
“RESOLVED THAT the Stakeholders’ Consultation Committee (SCC) of Shree Mahalaxmi Corporation Private Limited, hereby recommends the replacement of the current Liquidator, Mr. Debdas Chakraborty (Reg. No. IBBI/IPA-001/IP-P01794/2019-20/12758), appointed by the Hon’ble NCLT, Kolkata Bench – II, and proposes the appointment of Mr. Vijender Sharma, Insolvency Professional (Reg. No. IBBI/IPA-003/IP-N00003/2016-2017/10022), as the new Liquidator for the Corporate Debtor.”
“FURTHER RESOLVED THAT this proposal is approved by 100% of the voting share of the SCC members present and voting.”
“FURTHER RESOLVED THAT the State Bank of India, one of the members of the Consultation Committee be and is hereby authorized to place this resolution, along with all necessary supporting documents, before the Hon’ble National Company Law Tribunal, Kolkata Bench, for appropriate orders in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016.” The proposal was unanimously approved by 100% of the Committee Members present and voting. The Liquidator noted the resolution and it has been decided in the meeting that the proposal, for replacement of liquidator before the Hon’ble NCLT Kolkata Bench shall be moved by State Bank of India for its consideration and appropriate directions, as the appointment or replacement of a liquidator is subject to the approval of the Adjudicating Authority under the provisions of the Insolvency and Bankruptcy Code, 2016.”
5. It is submitted that the proposed liquidator has submitted his written consent in Form AA along with this Authorisation of Assignment (‘AFA’). The copies of the consent form and AFA are annexed as Annexure E.
6. It has also been submitted that the proposed liquidator is the present liquidator for two other companies, namely, Shree Padmavati Metaliks Private Limited and Ambay Coke Industries Private Limited, which were floated by the erstwhile Promoters and Directors of the Corporate Debtor. It is submitted that there were several cross transactions between the three companies and due to the erstwhile Promoters and Directors being the same, they were running and operating as the same group companies.
7. It is further submitted that the respondent did not accept the reduced fees as proposed by the SCC. It is further stated that members of the SCC had paid the expenses, which included the Liquidator’s fees in compliance with the order dated 05.12.2025 by this Tribunal. The relevant portion of the order dated 05.12.2025 is extracted below:
“Let the outstanding dues of the Liquidator be paid and in this regard a supplementary affidavit be filed within a period of one week.”
8. Respondents appeared in pursuance of notice issued by this Tribunal and filed its reply raising preliminary objection that the present Interlocutory Application is not maintainable in law and in facts. The present Petition has been filed in gross abuse of the process of law and the same is liable to be dismissed in limine.
9. It has been replied that at the 2nd SCC meeting, the issue of fees pertaining to the liquidator was taken up and in the same meeting, the proposal to replace the liquidator was also taken up and further, was approved without recording any grounds for replacement. Thus, this is in contravention to Regulation 31A of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2019 (for short the ‘Regulations’).
10. It is further replied that the members of the SCC had failed to cooperate with the Respondent and thus, had impeded the process. The members are alleged to have sought numerous adjournments, failure to attend meetings and blatant inaction to deliberate on critical agenda points.
11. Heard Learned Counsel appearing on behalf of the Applicant and the Respondents. We have gone through the pleadings of the parties and documents placed on record. We have duly appreciated the law applicable on the facts and circumstances of the present case.
12. It is pertinent to note that Regulation 31A of the IBBI(Liquidation Process) Regulation 2016 has been omitted by the IBBI (Liquidation Process) (Fourth Amendment) Regulations, 2026 vide Notification IBBI/2026-27/GN/REG151, dated 01.06.2026, w.e.f. 01.06.2026. This application was filed on 25.09.2025, and, thus, this Tribunal has the jurisdiction to adjudicate on the issue.
13. The SCC, in its 2nd Meeting held on 16.09.2025, resolved with 100% voting of the SCC members that the respondent, who is the present Liquidator, be replaced with Mr. Vijender Sharma, Insolvency Professional (Reg. No. IBBI/IPA-003/IP-N00003/2016-2017/10022), as the new Liquidator of the Corporate Debtor. The reason for replacement is that the common Liquidator would be appropriate for the holistic and effective resolution of the liquidation proceedings of the Corporate Debtor.
14. In the instant case, the Supplementary Affidavit filed by the Applicant states that two other groups companies, Shree Padmavati Metaliks Private Limited and Ambay Coke Industries Private Limited, have ongoing liquidations and the proposed liquidator is the common liquidator. Due to various connected transactions and business between the three companies, a common liquidator will be efficient.
15. It is pertinent, at this juncture for this Tribunal to take note of Section 31A (11) of the IBBI(Liquidation Process) Regulation 2016, and the same read as under:
“(11) The consultation committee, after recording the reasons, may by a majority vote of not less sixty-six per cent., propose to replace the liquidator and shall file an application, after obtaining the written consent of the proposed liquidator in Form AA of the Schedule II, before the Adjudicating Authority for replacement of the liquidator :
Provided that where a liquidator is proposed to be replaced, he shall-
(a) continue to work till his replacement; and
(b) be suitably remunerated for work performed till his replacement.”
16. From a bare perusal of this regulation, the requisites for a successful change of the liquidator is that the SCC shall approve the resolution for replacement of the liquidator with a majority not less than 66%, a valid written consent from the proposed liquidator, and shall file an application with the Adjudicating Authority.
17. It is also pertinent to note the provision of Section 34A has been inserted in IBC Code 2016 which provides for replacement of the liquidator and the same read as under:
“34A. Replacement of liquidator by committee of creditors.
(1) Where, at any time during the liquidation process, the committee of creditors is of the opinion that a liquidator appointed under section 34 or this section is required to be replaced, it may, by a vote of not less than sixty-six per cent. of the voting share, resolve to replace the liquidator with another insolvency professional, subject to a written consent from such proposed liquidator in such form as may be specified.
(2) Where the committee of creditors resolves under sub-section (1) to replace a liquidator, it shall apply to the Adjudicating Authority for the appointment of the proposed liquidator, and if no disciplinary proceedings are pending against him, the Adjudicating Authority shall, by an order, replace the liquidator appointed under section 34 or this section and appoint the proposed liquidator as the liquidator.”
18. In the instant case, there is a written consent on record of the proposed liquidator and there are no pending disciplinary proceedings against him. It is also noted that the replacement proposal was approved by 100% votes of the SCC. The written consent of the proposed liquidator is annexed as Annexure E.
19. Accordingly, in view of our aforesaid observation and law applicable thereon, we allow the appointment of Mr. Vijender Sharma, Insolvency Professional (Reg. No. IBBI/IPA-003/IP-N00003/2016-2017/10022) as the new Liquidator for the Corporate Debtor.
20. The outgoing liquidator shall hand over the charge of the entire documents of the Corporate Debtor to the incumbent liquidator within a period of 15 from the date of this order.
21. The I.A. (I.B) 1542/KB/2025 is allowed and disposed of.
