Liquidation Order Revocation Under Section 33(2) Not Possible Post Asset Transfer to Auction Buyer

By POONAM GANDHI Corporate Law Judiciary April 24, 2025

TaxGuru Citation: 2025 taxguru.in 2749
Case Name: P. Navcen Chakravarlhy Vs Ramakrishnan Sadasivam (NCLAT Chennai)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Courts: NCLAT

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P. Navcen Chakravarlhy Vs Ramakrishnan Sadasivam (NCLAT Chennai)

Revocation of liquidation order u/s. 33(2) not possible as property of Corporate Debtor handed over to Successful Auction Purchaser

NCLAT Chennai held that post completion of liquidation process and property of Corporate Debtor is handed over to Successful Auction Purchaser, order u/s. 33(2) of Insolvency and Bankruptcy Code, directing liquidation of corporate debtor’s cannot be revoked.

Facts- The Appellant vide the Company Appeal in question, has put a challenge to the impugned order dated 27.01.2021, as it has been rendered in IA/587/IB/2020 in IBA/257/2019 filed under Section 33(2) of I & B Code, which has resulted into the passing of an order of liquidation of the Corporate Debtor, (M/s. MK Cables and Conductors Pvt. Ltd.) and appointed Respondent No.1 as liquidator to the Corporate Debtor.

Conclusion- Held that apart from it, if the impugned order dated 27.01.2021, as rendered by the Learned Adjudicating Authority is taken into consideration, it has been a logical outcome of the resolution which was passed in the 9^th CoC meeting which recommended liquidation of the Corporate Debtor and based on such resolution of CoC and the written of consent of the Resolution Professional dated 18.06.2020 to function as liquidator, Learned Adjudicating Authority had ordered the Corporate Debtor to be put to liquidation, which is not established or argued to be in contravention to any of the provisions of law, as contemplated under the I & B Code. Since now much water has been flown after passing of the order of the appointment of the liquidator, the appeal deserves to be dismissed, as now third-party interest has been created subject to the confirmation of the sale made by the liquidator. The consequential effect would be that the so-called claim of the right of indemnification comes to an end, as over the assets as detailed above, with the Auction Purchaser already been placed in possession. Hence the Company Appeal would stand dismissed owing to the aforesaid reasons.