# In the matter of Diamond Shipping Company Ltd. CP (IB) No. 1250-KB-2018

> NCLT judgment dated 2019-09-16. Citation: TCN-2019-NCLT-01454. Yusen Logistics (India) Private Ltd., the Operational Creditor, filed an application under…

- **Court:** NCLT
- **Order date:** 16 Sept 2019
- **Citation:** TCN-2019-NCLT-01454
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/diamond-shipping-company-ltd-cp-ib-no-1250-kb-2018-a8ccbde4

## Summary

### Background

Yusen Logistics (India) Private Ltd., the Operational Creditor, filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, against Diamond Shipping Company Limited, the Corporate Debtor, to initiate the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor allegedly defaulted in paying an operational debt of Rs. 8,82,99,152/-. The authority admitted the corporate debtor into CIRP on 14.03.2019 and appointed CA Sonu Jain as the IRP. The IRP made a public announcement of CIRP and called for claims from creditors, verified the claims, and formed the CoC. The IRP's appointment was later confirmed.

## Facts

Yusen Logistics (India) Private Ltd., an operational creditor, initiated Corporate Insolvency Resolution Process (CIRP) against Diamond Shipping Company Limited, the corporate debtor, under Section 9 of the Insolvency & Bankruptcy Code, 2016, due to a default in payment of an operational debt amounting to Rs. 8,82,99,152/-. The NCLT admitted the application on 14.03.2019 and appointed CA Sonu Jain as the Interim Resolution Professional (IRP). The IRP took steps to constitute the Committee of Creditors (CoC). However, no resolution plan was received within the stipulated CIRP period of 180 days. The CoC, in its last meeting, resolved to request the NCLT to pass an order for liquidation of the corporate debtor. The RP issued Form G dated 24th August, 2019, as

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor should be liquidated due to the failure of the CIRP process to produce …

**Ratio:** Section 33 of the Insolvency and Bankruptcy Code, 2016, provides for the liquidation of

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**Reasoning:** The court reasoned that since the CIRP period of 180 days had expired and no resolution

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**Interpretation:** Section 33 mandates liquidation when CIRP fails, ensuring timely resolution or

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**Application:** Given the absence of a resolution plan within the CIRP period, the court

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Appellants:** Yusen Logistics…
- **Respondents:** Diamond Shipping…

## Timeline

- **2016-01-01 — Enactment of Insolvency and Bankruptcy Code,…**: The Insolvency and Bankruptcy Code, 2016, was enacted to consolidate and amend the laws…
- **2019-03-14 — Admission in…**: The authority admitted the corporate debtor, Diamond Shipping Company Limited, into…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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