# In the matter of Gokula Kannan Benefits Fund Limited IA-1251-2020 in CP-1418-IB-2018

> NCLT judgment dated 2021-12-23. Citation: TCN-2021-NCLT-00042. The case involves an application (IA/1251/2020) filed by the Resolution Professional (RP) of…

- **Court:** NCLT
- **Order date:** 23 Dec 2021
- **Citation:** TCN-2021-NCLT-00042
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/gokula-kannan-benefits-fund-limited-ia-1251-2020-in-cp-1418-ib-2018-bde13591

## Summary

### Background

The case involves an application (IA/1251/2020) filed by the Resolution Professional (RP) of Gokula Kannan Benefits Fund Limited under Section 33 of the Insolvency and Bankruptcy Code, 2016, seeking liquidation of the Corporate Debtor. The Corporate Insolvency Resolution Process (CIRP) was initiated on 25.01.2019. The Committee of Creditors (CoC) was formed, and the RP was confirmed. The RP stated that the Corporate Debtor had no tangible fixed assets and was engaged in lending and accepting deposits. An application was filed against the suspended Directors to remit unauthorizedly withdrawn funds. Expression of Interest invitations yielded no results. The CoC observed that continuing the business was not possible. The RP moved the application for liquidation on

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## Facts

Gokula Kannan Benefits Fund Limited underwent Corporate Insolvency Resolution Process (CIRP) initiated on 25.01.2019. Revathi S Raghunathan was appointed as the Resolution Professional (RP). The Corporate Debtor had no tangible fixed assets and was engaged in lending and accepting deposits. The RP formed a Committee of Creditors (CoC). The RP filed an application against the suspended Directors to remit Rs.12,86,800/- that had been unauthorizedly withdrawn. Expression of Interest invitations yielded no results. The CoC observed that continuing the business was not possible. A deadlock occurred within the CoC. The 180-day CIRP period expired on 25.07.2019. The RP moved an application for liquidation on 27.11.2019. Only a small number of depositors attended the CoC

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor, Gokula Kannan Benefits Fund Limited, should be liquidated under …

**Ratio:** Section 33(1) of the IBC, 2016, mandates liquidation if no resolution plan is received

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**Reasoning:** The Tribunal reasoned that the CIRP had failed because no Expression of Interest was

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**Interpretation:** Section 33(1) of the IBC is interpreted to mean that if the CIRP fails to

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**Application:** The Tribunal applied Section 33(1)(a) to the facts of the case, noting that the

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## Parties

- **Judges:** S. Ramath…; SAMEER…
- **Appellants:** Revathi S…
- **Respondents:** Gokula Kannan…
- **Advocates:** V. Maniv…

## Timeline

- **2019-01-25 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Gokula Kannan Benefits…
- **2019-03-02 — First CoC M…**: The first meeting of the Committee of Creditors (CoC) was conducted, and the Applicant…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33 — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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