# In the matter of Ajay kumar. Vs. Shree Sai Industries Pvt Ltd & Anr. CA(AT)(Insolvency) No. 616-2019

> NCLAT judgment dated 2019-07-11. Citation: TCN-2019-NCLAT-00455. The case involves an appeal against an interim order of liquidation passed by the…

- **Court:** NCLAT
- **Order date:** 11 Jul 2019
- **Citation:** TCN-2019-NCLAT-00455
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/ajay-kumar-vs-shree-sai-industries-pvt-ltd-anr-ca-1d1c42ca

## Summary

### Background

The case involves an appeal against an interim order of liquidation passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench) before the completion of 180 days in a Corporate Insolvency Resolution Process initiated against Dharam Paul Metal Pvt. Ltd. The Resolution Professional, Ajay Kumar, faced non-cooperation from the promoters of the Corporate Debtor, hindering his ability to take control and proceed with the liquidation process. The Committee of Creditors proposed liquidation without seeking an extension despite the promoters' non-cooperation.

## Facts

On 2019-07-11, the Corporate Insolvency Resolution Process was initiated against Dharam Paul Metal Pvt. Ltd. The Adjudicating Authority (National Company Law Tribunal, Mumbai Bench) passed an interim order of liquidation before the completion of 180 days. The promoters of Dharam Paul Metal Pvt. Ltd. did not cooperate and failed to hand over the records of the company. The Resolution Professional, Ajay Kumar, faced difficulties in taking control of the Corporate Debtor due to the lack of cooperation. The Committee of Creditors proposed liquidation without requesting an extension of the resolution period. The 1st Respondent, Shree Sai Industries Pvt. Ltd., is the Operational Creditor and not a member of the Committee of Creditors. The Adjudicating Authority prematurely

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority prematurely ordered liquidation without considering the …

**Ratio:** An order for liquidation should be passed after due consideration of all relevant facts

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**Reasoning:** The Adjudicating Authority failed to appreciate the facts regarding the non-cooperation

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**Interpretation:** The Insolvency and Bankruptcy Code emphasizes the importance of attempting

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**Application:** In this case, the Adjudicating Authority's order was set aside because it was

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## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…; +2 more
- **Appellants:** Ajay K…
- **Respondents:** Dharam Paul Metal…; Shree Sai…

## Timeline

- **2019-07-11 — Initiation…**: Corporate Insolvency Resolution Process…
- **2019-05-20 — Impugned Ord…**: The Adjudicating Authority passed…

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