# In the matter of Leel Electricals Limited

> NCLT judgment dated 2024-03-21. Citation: TCN-2024-NCLT-01996. The case pertains to an application filed by the Liquidator of LEEL Electricals Limited, Mr.…

- **Court:** NCLT
- **Order date:** 21 Mar 2024
- **Citation:** TCN-2024-NCLT-01996
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/leel-electricals-limited-42f784a3

## Summary

### Background

The case pertains to an application filed by the Liquidator of LEEL Electricals Limited, Mr. Ganga Ram Agarwal, under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, seeking directions for implementing the sale of the Corporate Debtor (LEEL Electricals Ltd.) as a going concern to Krishna Ventures Ltd., the successful auction purchaser. The Corporate Insolvency Resolution Process (CIRP) was initiated on 2020-03-04. As no resolution plan was approved, liquidation was initiated on 2021-12-06. The liquidator then initiated the sale of the corporate debtor's assets, including the sale of the company as a going concern. The application seeks various reliefs, concessions, waivers, and ancillary protections to facilitate the sale.

## Facts

The Corporate Insolvency Resolution Process (CIRP) of LEEL Electricals Limited was initiated on 2020-03-04. As no resolution plan was approved, liquidation was initiated on 2021-12-06. The Liquidator initiated the process in terms of Regulation 12 of IBBI (Liquidation Regulations), 2016 by publishing Form-B on 2021-12-07 for inviting claims from various stakeholders of the Corporate Debtor and thereafter constituted Stakeholders Consultation Committee (SCC) on 2022-02-04. The first meeting of the SCC took place on 2022-02-14 wherein it was decided that reserve price for the sale of assets of the Corporate Debtor as a going concern will be fixed at Rs. 100 crores. In the 2nd Meeting of SCC which was held on 2022-02-28, it was decided to publish a sale notice in a manner

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## Issues and analysis

### Issue 1: Whether the sale of the Corporate Debtor as a going concern can be approved under the provisions of …

**Ratio:** The sale of a corporate debtor as a going concern is recognized as a method of sale under

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**Reasoning:** The court considered the reports of the Insolvency Law Committee and the IBBI, which

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**Interpretation:** The term 'going concern' implies that the Corporate Debtor would be functional

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**Application:** In this case, the court found that after selling six plants of the Corporate

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** Ganga Ram A…
- **Respondents:** LEEL Electricals…; Krishna Ventures…

## Timeline

- **2020-03-04 — CIRP Init…**: Corporate Insolvency Resolution Process…
- **2021-12-06 — Liquidation In…**: Liquidation process of the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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