# In the matter of Eshal Foods Private Limited C.A.  1193-2020 in C.P. No. (IB)-1412(ND)-2019

> NCLT judgment dated 2020-02-19. Citation: TCN-2020-NCLT-01889. Ambe Agrofoods Private Limited, the Operational Creditor, initiated Corporate Insolvency…

- **Court:** NCLT
- **Order date:** 19 Feb 2020
- **Citation:** TCN-2020-NCLT-01889
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/eshal-foods-private-limited-ca-1193-2020-in-cp-no-ib-1412nd-2019-74e36f9d

## Summary

### Background

Ambe Agrofoods Private Limited, the Operational Creditor, initiated Corporate Insolvency Resolution Process (CIRP) against Eshal Foods Private Limited, the Corporate Debtor, under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016. The application was admitted on 2019-09-19, and Mr. Rajesh Kumar Gupta was appointed as the Interim Resolution Professional (IRP). The IRP made a public announcement and constituted a Committee of Creditors (CoC). The CoC, in its fourth meeting, proposed liquidation of the Corporate Debtor due to the cessation of business operations and lack of revenue.

## Facts

Ambe Agrofoods Private Limited, an operational creditor, initiated CIRP against Eshal Foods Private Limited. The application was admitted on 2019-09-19. Rajesh Kumar Gupta was appointed as IRP and later confirmed as RP. The CoC was formed, including HDFC Bank, Shiva Paper Mart, Manisha Gupta, and Namarta Singhal. The fourth CoC meeting on 2020-01-25 proposed liquidation due to the Corporate Debtor's cessation of business operations and lack of revenue. The CoC voted in favor of liquidation with 100% voting rights. There was no resolution plan. The NCLT ordered liquidation, appointing Rajesh Kumar Gupta as liquidator. The order included directions for public announcement, cessation of moratorium under Section 14, and commencement of a fresh moratorium under Section

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## Issues and analysis

### Issue 1: Whether the application for liquidation of the Corporate Debtor, M/s Eshal Foods Private Limited, …

**Ratio:** The decision to liquidate a corporate debtor rests primarily with the Committee of

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**Reasoning:** The NCLT reasoned that the CoC, in its meeting, had resolved to liquidate the Corporate

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**Interpretation:** This legal issue involves the interpretation of the powers and responsibilities

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**Application:** In this case, the CoC voted in favor of liquidation with 100% voting rights.

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## Parties

- **Judges:** Ina Mal…; L. N. G…
- **Appellants:** Ambe Agrofoods…
- **Respondents:** Eshal Foods…

## Timeline

- **2019-09-19 — Admission of Ap…**: The application filed by Ambe Agrofoods Private Limited under Section 9 of the IBC was…
- **2019-10-17 — Public Annou…**: The Interim Resolution Professional (IRP)…

## 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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