# In the matter of Adyama Rice Mill Private Limited CA(IB) No. 1330-KB-2019 in CP (IB) No. 109-KB-2019

> NCLT judgment dated 2020-02-03. Citation: TCN-2020-NCLT-02104. The case involves an application for the initiation of Corporate Insolvency Resolution Process…

- **Court:** NCLT
- **Order date:** 3 Feb 2020
- **Citation:** TCN-2020-NCLT-02104
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/adyama-rice-mill-private-limited-caib-no-1330-kb-2019-in-cp-ib-no-109-kb-2019-80a0bfd0

## Summary

### Background

The case involves an application for the initiation of Corporate Insolvency Resolution Process (CIRP) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Adyama Rice Mill Private Limited. United Bank of India, the financial creditor, filed the application. The CIRP was initiated, and an interim resolution professional (IRP) was appointed, later replaced by a resolution professional (RP). The Committee of Creditors (CoC) was formed, but due to the corporate debtor's non-cooperation and lack of resolution plans, the CoC decided against extending the CIRP and recommended liquidation.

## Facts

United Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Adyama Rice Mill Private Limited for initiating the Corporate Insolvency Resolution Process (CIRP). The application was admitted on 06.08.2019, and Mr. Balaknath Bhattacharyya was appointed as the interim resolution professional (IRP). The Committee of Creditors (CoC) was formed and convened several meetings. However, the directors of Adyama Rice Mill Private Limited did not cooperate with the IRP/RP by failing to provide necessary documents and information. The CoC decided not to extend the CIRP period due to the lack of a resolution plan and recommended liquidation. The CIRP period expired on 1st February, 2020. The directors objected to the liquidation,

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## Issues and analysis

### Issue 1: Whether the application for liquidation should be allowed given the corporate debtor's …

**Ratio:** Section 33(1)(a) of the Insolvency and Bankruptcy Code, 2016, allows for liquidation when

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**Reasoning:** The court reasoned that the corporate debtor's deliberate non-cooperation hindered the

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**Interpretation:** Section 33(1)(a) provides the legal basis for initiating liquidation

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**Application:** Given the corporate debtor's non-cooperation and the CoC's decision, the court

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## Parties

- **Judges:** Jinan…; Harish Chander…
- **Appellants:** United Bank of…
- **Respondents:** Adyama Rice Mill…

## Timeline

- **2019-08-06 — Application A…**: The application for CIRP was admitted, and Mr. Balaknath Bhattacharyya was appointed as…
- **2019-08-28 — CoC Conv…**: The Committee of Creditors (CoC) was convened, and Mr. Bhattacharyya's appointment was…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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