# In the matter of IDT Clothing Pvt. Ltd.

> NCLT judgment dated 2023-10-26. Citation: TCN-2023-NCLT-01017. The case involves an application for the dissolution of IDT Clothing Private Limited, a…

- **Court:** NCLT
- **Order date:** 26 Oct 2023
- **Citation:** TCN-2023-NCLT-01017
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/idt-clothing-pvt-ltd-06a6c40f

## Summary

### Background

The case involves an application for the dissolution of IDT Clothing Private Limited, a corporate debtor, which was undergoing liquidation under Section 54 of the Insolvency and Bankruptcy Code, 2016. The company was engaged in textile production but closed its unit in 2020. It was admitted into CIRP on 28.01.2019 following an application by an operational creditor. The applicant, Mr. Manoj Kumar Mishra, was appointed as the Interim Resolution Professional (IRP) and later confirmed as the Resolution Professional. Despite inviting expressions of interest, no revival plan materialized, leading the Committee of Creditors (CoC) to recommend liquidation.

## Facts

IDT Clothing Private Limited, a textile production company, ceased operations in 2020. An operational creditor initiated Corporate Insolvency Resolution Process (CIRP), leading to the appointment of Mr. Manoj Kumar Mishra as the Interim Resolution Professional (IRP) and later as the Resolution Professional. The Committee of Creditors (CoC), consisting solely of State Bank of India, decided against extending the CIRP period due to a lack of interest in reviving the company and recommended liquidation. The company was ordered to be liquidated on 16.12.2019. Public announcements were made to invite claims from stakeholders. The Stakeholders Consultation Committee (SCC) was formed, including State Bank of India, Arjun Radheshyam Gupta, and the Income Tax Officer. The

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor, IDT Clothing Private Limited, should be dissolved under Section 54(2) …

**Ratio:** Section 54(2) of the Insolvency and Bankruptcy Code, 2016, allows for the dissolution of

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**Reasoning:** The court reasoned that since the assets of IDT Clothing Private Limited had been

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**Interpretation:** Section 54(2) provides a mechanism for formally concluding the insolvency

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**Application:** The court applied Section 54(2) to the facts of the case, noting that all

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## Parties

- **Judges:** ANIL RAJ C…; Kuldip Kumar…
- **Appellants:** Manoj Kumar…
- **Respondents:** IDT Clothing Pvt.…
- **Advocates:** Aniket S…

## Timeline

- **2020-01-01 — Unit Clo…**: The Corporate Debtor's textile…
- **2019-01-28 — Admission in…**: The Corporate Debtor was admitted into…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 54 — Dissolution of corporate debtor](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-54)

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