# In the matter of Y M Foodways Pvt. Ltd. IA-4943 & 5610-2020 in IB-421-ND-2019

> NCLT judgment dated 2021-02-04. Citation: TCN-2021-NCLT-03118. The case involves an application for liquidation of the Corporate Debtor, Y M Foodways Private…

- **Court:** NCLT
- **Order date:** 4 Feb 2021
- **Citation:** TCN-2021-NCLT-03118
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/y-m-foodways-pvt-ltd-ia-4943-5610-2020-in-ib-421-nd-2019-59c3a0e3

## Summary

### Background

The case involves an application for liquidation of the Corporate Debtor, Y M Foodways Private Limited, under Section 33(2) of the Insolvency and Bankruptcy Code (IBC), 2016. The Corporate Insolvency Resolution Process (CIRP) had commenced against the Corporate Debtor vide order dated 21.11.2019. The Resolution Professional (RP) was appointed, and the Committee of Creditors (CoC) was constituted. Despite inviting expressions of interest, no resolution plan was received. The CoC, with 100% voting, approved the resolution for liquidation.

## Facts

The Corporate Debtor (Y M Foodways Private Limited) underwent CIRP, initiated on 2019-11-21. Mr. Amit Kaushal was initially appointed as the Interim Resolution Professional (IRP) and later replaced by Mr. Satya Prakash. The company's share capital was Rs. 1.0 lakh, with negative reserves and surplus of Rs. 18.5 crore as of 2020-03-31. The company's revenue from operations was Rs. 2.93 crore during 2019-20, significantly lower than the Rs. 237 crore during 2018-19. The CoC, consisting of operational creditors, approved liquidation with 100% voting after no resolution plan was received despite inviting expressions of interest. The RP was appointed as the liquidator. The company had been supplying milk to Kwality, which also went into liquidation, stopping their business.

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## Issues and analysis

### Issue 1: Whether the application for liquidation of the Corporate Debtor under Section 33(2) of the …

**Ratio:** Section 33(2) of the IBC allows the Adjudicating Authority to pass a liquidation order if

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**Reasoning:** The CoC, with 100% voting, approved the resolution for liquidation. The RP submitted that

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**Interpretation:** Section 33(2) provides a clear pathway for liquidation when the CoC, by a

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**Application:** In this case, the CoC approved liquidation with 100% voting, and no resolution

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## Parties

- **Judges:** ABNI RANJAN KUMAR…; K.K. V…
- **Appellants:** Sumukhi Sales Pvt…
- **Respondents:** Y M Foodways…; Y M Foodways Pvt…
- **Advocates:** Satya Pr…

## Timeline

- **2019-11-21 — CIRP Comm…**: Corporate Insolvency Resolution Process (CIRP) commenced against the Corporate Debtor…
- **2019-12-12 — CoC Consti…**: The IRP constituted CoC on 12.12.2019…

## 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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