# In the matter of Kandla Energy and Chemicals Ltd.

> NCLT judgment dated 2024-01-29. Citation: TCN-2024-NCLT-02864. The case involves an application filed by the Resolution Professional (RP) of Kandla Energy and…

- **Court:** NCLT
- **Order date:** 29 Jan 2024
- **Citation:** TCN-2024-NCLT-02864
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/kandla-energy-and-chemicals-ltd-c3f6b18e

## Summary

### Background

The case involves an application filed by the Resolution Professional (RP) of Kandla Energy and Chemicals Limited under Section 33 of the Insolvency and Bankruptcy Code, 2016 (IBC) for the liquidation of the Corporate Debtor. State Bank of India, a Financial Creditor, had initiated Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, which was admitted by the Tribunal on 21.10.2022. The applicant was appointed as the Interim Resolution Professional (IRP). After the commencement of CIRP, the RP published Form-G inviting Expression of Interest (EoI) from prospective Resolution Applicants. A resolution plan was received but not approved or rejected by the Committee of Creditors (CoC). The CoC resolved to file an application for extension of the

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## Facts

The Corporate Debtor, Kandla Energy and Chemicals Limited, was incorporated under the provisions of the Companies Act, 1956. State Bank of India, a Financial Creditor, filed an application under Section 7 of the IBC, 2016, to initiate CIRP against the Corporate Debtor. The Tribunal admitted the Corporate Debtor into CIRP on 21.10.2022 and appointed the applicant as the Interim Resolution Professional (IRP). The IRP issued a public announcement inviting claims from creditors. The first CoC meeting was held on 25.11.2022, where the resolution passed for the appointment of IRP as the RP of the Corporate Debtor. The RP published Form-G inviting Expression of Interest (EoI) from prospective Resolution Applicants. A resolution plan was received but not approved or rejected

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## Issues and analysis

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

**Ratio:** Section 33(2) of the IBC, 2016, allows for the liquidation of the Corporate Debtor if the

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**Reasoning:** The CoC, in its commercial wisdom, decided to liquidate the Corporate Debtor as it failed

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**Interpretation:** Section 33(2) of the IBC grants the CoC the power to decide on the liquidation

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**Application:** The CoC, with a 79% majority, decided to liquidate the Corporate Debtor.

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## Parties

- **Judges:** Chitra Ha…; Velamur G Venkata…
- **Appellants:** Nimai Gauta…
- **Respondents:** Kandla Energy and…

## Timeline

- **1956-01-01 — Incorpor…**: Corporate Debtor was incorporated under the…
- **2022-10-21 — CIRP Admi…**: Tribunal admitted the Corporate Debtor into CIRP and appointed the applicant as the…

## Legal provisions

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

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