# In the matter of RLS Alloys Private Limited IA-22,206,796 & 932-2021 in CP-661-CB-(IB)-2017

> NCLT judgment dated 2022-06-02. Citation: TCN-2022-NCLT-02479. The case involves multiple Interlocutory Applications (IAs) filed in connection with the…

- **Court:** NCLT
- **Order date:** 2 Jun 2022
- **Citation:** TCN-2022-NCLT-02479
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rls-alloys-private-limited-ia-22206796-932-2021-in-cp-661-cb-ib-2017-631099fb

## Summary

### Background

The case involves multiple Interlocutory Applications (IAs) filed in connection with the Corporate Insolvency Resolution Process (CIRP) and subsequent liquidation of RLS Alloys Private Limited. The CIRP was initiated on 2018-12-03 under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016. The respondent was appointed as the IRP and later as the liquidator. IA/796/2021 was filed by Indian Bank, the sole financial creditor, seeking to set aside the e-auction sale conducted on 2020-09-25, alleging irregularities and lack of transparency. IA/206/CHE/2021 was filed by the successful auction applicant seeking directions for issuance of sale certificate and handover of property. IA/22/CHE/2021 and IA/932/2020 were also considered.

## Facts

The Corporate Insolvency Resolution Process (CIRP) against RLS Alloys Private Limited commenced on 2018-12-03. The respondent was appointed as the IRP and later as the liquidator. The liquidator conducted an e-auction on 2020-09-23 for the sale of the corporate debtor's assets, with a reserved price of Rs. 1,06,55,550/-. Mr. S. Ramalingam emerged as the highest bidder with a bid of Rs. 15,65,55,550/-, but subsequently claimed it was a typographical error and requested cancellation. The liquidator cancelled the auction and re-fixed it for 2020-09-25 without issuing a fresh auction notice. The upset price remained the same. Mr. G. Subramanian was declared the highest bidder in the re-auction with a bid of Rs. 1,10,55,550/-, despite having bid Rs. 1,55,55,550/- in the

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## Issues and analysis

### Issue 1: Whether the e-auction conducted by the liquidator on 2020-09-25 was conducted in a transparent and …

**Ratio:** The principle of transparency and fairness in liquidation proceedings requires that all

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**Reasoning:** The court found that the liquidator's failure to issue a fresh auction notice, the

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**Interpretation:** The legal issue revolves around the interpretation of the duties and

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**Application:** In this case, the court applied the principle of transparency and fairness to

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## Parties

- **Judges:** R. Sucha…; SAMEER…
- **Appellants:** Indian…
- **Respondents:** RLS Alloys…; CA. R.Shan…

## Timeline

- **2018-12-03 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) against RLS Alloys Private Limited…
- **2019-06-14 — Liquidation…**: Liquidation of the Corporate…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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