Withdrawal Of Liquidation Application Can Be Permitted When CoC Allows RP To File Application Seeking Extension Of CIRP Time Period: NCLAT

The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mita (Technical Member) and Mr. Arun Baroka (Technical Member) has held that when the CoC has already taken decision to file an application for extension of CIRP time period and granting permission to publish Form G for third time, withdrawal of liquidation application by Adjudicating Authority can be permitted. Brief Facts: The present appeal has been filed against an order passed by the Adjudicating Authority, which rejected an IA filed by the Suspended Director of the corporate debtor. The Adjudicating Authority dismissed the appellant's prayers to recall its order extending the time for completing the CIRP, set aside the resolution plan accepted by the CoC, and bar the Resolution Professional from acting as the RP. The appellant argued that an error was committed by the Adjudicating Authority by permitting the withdrawal of the liquidation application in the absence of a resolution passed by the CoC on this behalf. Observations: The NCLAT at the outset noted that since resolution was already passed by the CoC seeking extension of the CIRP period, the Corporate Debtor did not go into compulsory liquidation under Section 33(1)(A) of the Code. It further noted that the CoC has also approved the filing of an application before the Adjudicating Authority for the issuance of a revised Form G. In light of the above the discussion, the tribunal concluded that “when the CoC has already taken decision to file application for extension of time and granting permission to publish Form G for third time, no error was committed by the Adjudicating Authority by permitting withdrawal of the liquidation application, in facts of the present case.” Accordingly, the present appeal was dismissed. Case Title: 'Ramesh Jadhav Vs. Vakati Balasubramaniam Reddy & Anr.' Case Number: Company Appeal (AT) (Ins) No. 173 of 2025 Judgment Date: 28/01/2025 For Appellant : Present but appearance not marked. For Respondents : Click Here To Read/Download The Order

Withdrawal Of Liquidation Application Can Be Permitted When CoC Allows RP To File Application Seeking Extension Of CIRP Time Period: NCLAT

Mohd Malik Chauhan

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