# In the matter of Kavan Cotton Pvt. Ltd.

> NCLT judgment dated 2024-04-29. Citation: TCN-2024-NCLT-01533. The case pertains to an application filed under Section 33(2) and Section 34 of the Insolvency…

- **Court:** NCLT
- **Order date:** 29 Apr 2024
- **Citation:** TCN-2024-NCLT-01533
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/kavan-cotton-pvt-ltd-79015289

## Summary

### Background

The case pertains to an application filed under Section 33(2) and Section 34 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking the liquidation of the Corporate Debtor, M/s. Kavan Cotton Pvt. Ltd. The Corporate Insolvency Resolution Process (CIRP) was initiated on 11.09.2023. Public announcement was made, and a Committee of Creditors (CoC) was formed, comprising of one Financial Creditor, Raj Radhe Finance Limited. Several CoC meetings were held to discuss the resolution process. No resolution plan was received during the CIRP.

## Facts

Rajradhe Finance Ltd initiated CIRP against Kavan Cotton Pvt Ltd. CIRP was initiated on 2023-09-11. Public announcement was made, and a CoC was formed, consisting of Raj Radhe Finance Limited. The first CoC meeting was held on 2023-10-09, where the applicant was appointed as Resolution Professional. Subsequent meetings were held on 2023-11-04 and 2023-11-30. No resolution plan was received by the deadline of 2023-10-31. The CoC decided to liquidate the Corporate Debtor under Section 33 of the IBC. The fourth CoC meeting was held on 2024-02-12. The RP apprised the committee that there appeared to be few assets and recovery of the same is possible. The CoC decided to go for liquidation of the Corporate Debtor under Section 33 sub-Section 24 IBC, 2016. The applicant/RP

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## Issues and analysis

### Issue 1: Whether the application for liquidation of the Corporate Debtor, M/s. Kavan Cotton Pvt. Ltd., under …

**Ratio:** Section 33(2) of the IBC allows for the initiation of liquidation proceedings when no

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**Reasoning:** The court considered that no resolution plan was received during the CIRP, and the CoC,

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**Interpretation:** Section 33(2) provides a clear pathway for liquidation when resolution efforts

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**Application:** Given the absence of a resolution plan and the CoC's decision, the court

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## Parties

- **Judges:** SHAMMI…; SAMEER…
- **Appellants:** Rajradhe Finance…
- **Respondents:** Kavan Cotton Pvt…
- **Advocates:** Vishwaas…; Vinod Kuma…

## Timeline

- **2023-09-11 — CIRP Init…**: Corporate Insolvency Resolution…
- **2023-10-09 — First CoC M…**: First meeting of CoC was held wherein the representative of Sales Tax of Gujarat were…

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