# In the matter of Parekh Aluminex Ltd. IA No. 675 of 2020 in CP (IB) No. 1262/MB/MAH/2017

> NCLT judgment dated 2020-10-07. Citation: TCN-2020-NCLT-00441. The case pertains to an application filed by the Resolution Professional (RP) under Section…

- **Court:** NCLT
- **Order date:** 7 Oct 2020
- **Citation:** TCN-2020-NCLT-00441
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/parekh-aluminex-ltd-ia-no-675-of-2020-in-cp-ib-no-1262mbmah2017-2a604095

## Summary

### Background

The case pertains to an application filed by the Resolution Professional (RP) under Section 33(2) of the Insolvency and Bankruptcy Code, 2016, seeking orders for the liquidation of Parekh Aluminex Ltd., the Corporate Debtor. The Corporate Insolvency Resolution Process (CIRP) was initiated following an order by the NCLT, Mumbai, on 23.11.2017, under Section 7 of the Code. The Interim Resolution Professional (IRP) was appointed, who then constituted the Committee of Creditors (CoC). The CoC conducted several meetings to explore resolution plans, including inviting prospective resolution applicants. Despite these efforts, no viable resolution plan was received.

## Facts

The NCLT, Mumbai, initiated Corporate Insolvency Resolution Process (CIRP) for Parekh Aluminex Ltd. on 2017-11-23 under Section 7 of the Insolvency and Bankruptcy Code, 2016. Avil Menezes was appointed as the Interim Resolution Professional (IRP) and later as the Resolution Professional (RP). The Committee of Creditors (CoC) was formed, and several meetings were held to explore resolution plans. Four Prospective Resolution Applicants (PRAs) submitted their Expression of Interest (EOI). The CoC considered a plan submitted by Eight Finance Private Limited but eventually approved the extension of CIRP by 90 days. A Resolution Applicant later sought to withdraw their plan, leading to the forfeiture of their Earnest Money Deposit (EMD) of Rs. 2 crores. Ultimately, the CoC

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## Issues and analysis

### Issue 1: Whether the Tribunal should order the liquidation of the Corporate Debtor, Parekh Aluminex Ltd., …

**Ratio:** The Adjudicating Authority (NCLT) is not expected to do anything more but is obligated to

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**Reasoning:** The Tribunal relied on the Supreme Court's judgment in K. Sashidhar v. Indian Overseas

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**Interpretation:** Section 33(1) of the Insolvency and Bankruptcy Code mandates the initiation of

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**Application:** Given that the CoC voted for liquidation with 89.19% voting share and no viable

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## Parties

- **Judges:** Janab Mohammed…; RavikumarDu…
- **Appellants:** Avil Me…
- **Respondents:** Parekh Aluminex…

## Timeline

- **2017-11-23 — Initiation…**: NCLT, Mumbai, admitted the Petition (CP (IB) No. 1262/MB/MAH/2017) under Section 7 of the…
- **2018-01-10 — First CoC M…**: The IRP constituted the Committee of Creditors…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33(2) — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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