# In the matter of Earth Mover Consultancy Pvt. Ltd.

> NCLT judgment dated 2023-07-27. Citation: TCN-2023-NCLT-02302. The case involves an application by the Resolution Professional of Earth Mover Consultancy…

- **Court:** NCLT
- **Order date:** 27 Jul 2023
- **Citation:** TCN-2023-NCLT-02302
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/earth-mover-consultancy-pvt-ltd-119651ff

## Summary

### Background

The case involves an application by the Resolution Professional of Earth Mover Consultancy Private Limited, a Corporate Debtor, under Section 49 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking directions regarding the promoters/directors and ex-employees of the Corporate Debtor. The Corporate Insolvency Resolution Process (CIRP) was initiated on 2019-10-21. The Committee of Creditors (CoC) resolved to liquidate the Corporate Debtor. A forensic audit revealed potential misappropriation of funds and preferential transactions.

## Facts

The Corporate Insolvency Resolution Process (CIRP) of Earth Mover Consultancy Private Limited was initiated on 2019-10-21. Pramod Kumar Singh was appointed as the Interim Resolution Professional (IRP) and later confirmed as the Resolution Professional. A forensic audit conducted by M/s. DANSPARK & Co. revealed that the Corporate Debtor had disposed of assets without proper accounting and engaged in preferential transactions. The last audited accounts available were for the financial year 2011-12. In a CoC meeting held on 2020-01-31, the CoC resolved to liquidate the Corporate Debtor. The Resolution Professional filed an application for liquidation under Section 33(2) of the IBC. The respondents, who are the main promoters and suspended directors of the Corporate

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## Issues and analysis

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

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

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**Reasoning:** The CoC, in its meeting held on 2020-01-31, resolved to liquidate the Corporate Debtor

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**Interpretation:** Section 33(2) of the IBC provides a mechanism for liquidation when the CoC

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**Application:** In this case, the CoC has resolved to liquidate the Corporate Debtor due to

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## Parties

- **Judges:** BIDISHA BA…; Balraj…
- **Appellants:** M/s. Tata Hitachi…
- **Respondents:** M/S EARTH MOVER…; Aziz Husain…

## Timeline

- **2019-10-21 — CIRP Init…**: Adjudicating Authority passed an order for commencement of Corporate Insolvency…
- **2019-12-09 — Appointment of…**: Order confirming the appointment of Interim Resolution Professional as Resolution…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 49 — Transactions defrauding creditors](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-49)

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