# In the matter of Nexus Electro Steel Ltd. IA(IBC)-773(CHE)2022 in CP(IB)-377(CHE)2022

> NCLT judgment dated 2022-09-09. Citation: TCN-2022-NCLT-01129. The case involves an application filed under Section 33(2) of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 9 Sept 2022
- **Citation:** TCN-2022-NCLT-01129
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/nexus-electro-steel-ltd-iaibc-773che2022-in-cpib-377che2022-a479c6c4

## Summary

### Background

The case involves an application filed under Section 33(2) of the Insolvency and Bankruptcy Code, 2016, seeking an order for the liquidation of the Corporate Debtor, Nexus Electro Steel Limited. The Corporate Insolvency Resolution Process (CIRP) was initiated on 30.03.2021, and Mr. Mathur Sabhapathy Viswanathan was appointed as the Interim Resolution Professional (IRP). The IRP issued Form-G inviting Expression of Interest (EoI) from Prospective Resolution Applicants (PRA), but no eligible EoI was received. The Adjudicating Authority appointed the Applicant as the Resolution Professional (RP) on 01.02.2022. The RP appointed SPR & Co Chartered Accountants to conduct a forensic audit and filed two applications under Section 66 of IBC, 2016. The Resolution Plans

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## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Nexus Electro Steel Limited on 2021-03-30. Mr. Mathur Sabhapathy Viswanathan was appointed as the Interim Resolution Professional (IRP). The IRP issued Form-G on 2021-06-25, inviting Expression of Interest (EoI) from Prospective Resolution Applicants (PRA). No eligible EoI was received, leading the CoC to issue a second Form-G on 2021-08-21. Two EoIs were received in response to the second Form-G, but both were deemed ineligible. On 2022-02-01, the Adjudicating Authority appointed the Applicant, Radhakrishnan Dharmarajan, as the Resolution Professional (RP). The RP appointed SPR & Co Chartered Accountants to conduct a forensic audit. The RP filed two applications under Section 66 of IBC, 2016.

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor, Nexus Electro Steel Limited, should be liquidated under Section 33(2) …

**Ratio:** Section 33(2) of the Insolvency and Bankruptcy Code, 2016, allows for the liquidation of

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**Reasoning:** The CoC, in its 17th meeting held on 2022-06-23, resolved to liquidate the Corporate

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**Interpretation:** Section 33(2) provides a mechanism for liquidation when the CIRP fails to

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**Application:** The resolution plans for Nexus Electro Steel Limited were not approved by the

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## Parties

- **Judges:** BACHU VENKAT…; Shri. Samee…
- **Appellants:** Radhakrishnan…
- **Respondents:** Nexus Electro…

## Timeline

- **2021-03-30 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Nexus Electro Steel…
- **2021-03-31 — Public Annou…**: IRP caused public…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 66 — Fraudulent trading or wrongful trading](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-66)

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