# In the matter of Sholingur Textiles Limited MA-1192-2019 in CP-1037-IB-2018

> NCLT judgment dated 2020-02-13. Citation: TCN-2020-NCLT-01960. The case pertains to an application filed under Section 33(2) & 34(1) of the Insolvency and…

- **Court:** NCLT
- **Order date:** 13 Feb 2020
- **Citation:** TCN-2020-NCLT-01960
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/sholingur-textiles-limited-ma-1192-2019-in-cp-1037-ib-2018-13434883

## Summary

### Background

The case pertains to an application filed under Section 33(2) & 34(1) of the Insolvency and Bankruptcy Code, 2016 ('IBC, 2016') seeking liquidation of the Corporate Debtor, Sholingur Textiles Limited. The application was moved by the Resolution Professional (RP) after the Committee of Creditors (CoC) passed a resolution for liquidation in its 8th meeting held on 16.10.2019, as no resolution plan was received during the Corporate Insolvency Resolution Process (CIRP). The CIRP was initiated on 04.02.2019, and an Interim Resolution Professional was appointed. Public announcement was made on 09.02.2019. Several CoC meetings were held, but no resolution plan materialized.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Sholingur Textiles Limited on 04.02.2019. An Interim Resolution Professional (IRP) was appointed, and a public announcement was made on 09.02.2019. The Committee of Creditors (CoC) was constituted, and eight CoC meetings were held between 07.03.2019 and 16.10.2019. Despite receiving three Expressions of Interest (EOIs) from prospective Resolution Applicants, no resolution plan was filed. The initial CIRP period of 180 days expired on 03.08.2019, and the extended period of 90 days expired on 01.11.2019. The CoC unanimously voted for the liquidation of the Corporate Debtor in its 8th meeting. The Resolution Professional (RP) filed an application under Section 33(2) & 34(1) of the Insolvency and

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## Issues and analysis

### Issue 1: Whether the application for liquidation of the Corporate Debtor, Sholingur Textiles Limited, under …

**Ratio:** Section 33(2) of the Insolvency and Bankruptcy Code, 2016, allows the Adjudicating

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**Reasoning:** The Tribunal reasoned that since no resolution plan was received during the CIRP, and the

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**Interpretation:** Section 33(2) of the IBC is interpreted to mean that if the CIRP fails to

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**Application:** In this case, the CIRP failed to produce a resolution plan, and the CoC

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## Parties

- **Judges:** R. VARADH…; Anil Ku…
- **Appellants:** T.V BALASUBRAMANIA…
- **Respondents:** SHOLINGUR…

## Timeline

- **2019-02-04 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Sholingur Textiles…
- **2019-02-09 — Public Annou…**: Public announcement made by the…

## 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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