# In the matter of Ruchika Tradelink Private Limited IA (IB) No. 113-KB-2022 in CP (IB) No. 785-KB-2019

> NCLT judgment dated 2022-03-09. Citation: TCN-2022-NCLT-03822. The case pertains to an application filed under regulation 38(1) of the Insolvency and…

- **Court:** NCLT
- **Order date:** 9 Mar 2022
- **Citation:** TCN-2022-NCLT-03822
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ruchika-tradelink-private-limited-ia-ib-no-113-kb-2022-in-cp-ib-no-785-kb-2019-3f2584b9

## Summary

### Background

The case pertains to an application filed under regulation 38(1) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, regarding the liquidation of Ruchika Tradelink Private Limited. The Adjudicating Authority had previously initiated liquidation proceedings against the Corporate Debtor, Ruchika Tradelink Private Limited, on 03.02.2020 and appointed a Liquidator. The liquidator filed an application seeking permission for the distribution of unsold assets of the Corporate Debtor amongst the stakeholders in proportion to their claim. Public announcement was made on 7th February 2020, inviting claims from stakeholders, and seven unsecured financial creditors submitted their claims.

## Facts

Mr. Nandalal Khandelwal, an operational creditor, initiated proceedings against Ruchika Tradelink Private Limited, the corporate debtor. The Adjudicating Authority initiated liquidation proceedings against Ruchika Tradelink Private Limited on 03.02.2020 and appointed a Liquidator. The Liquidator filed an application under regulation 38(1) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, seeking permission for the distribution of unsold assets of the Corporate Debtor amongst the stakeholders. The Corporate Debtor's assets include quoted and unquoted equity shares, short-term loans, and bank balances. The trading activities of the Corporate Debtor and some of its investments are frozen. The stakeholders have confirmed their consent

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## Issues and analysis

### Issue 1: Whether the proposed distribution of unsold assets of the Corporate Debtor amongst the stakeholders …

**Ratio:** Regulation 38 of the Liquidation Process Regulations allows for the distribution of

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**Reasoning:** The court considered the fact that the assets of the Corporate Debtor were of a peculiar

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**Interpretation:** Regulation 38 provides a mechanism for distributing assets when conventional

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**Application:** Given the peculiar nature of the assets and the consent of the stakeholders,

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## Parties

- **Judges:** Rajasekha…; Balraj…
- **Appellants:** Nandalal Khandelwa…
- **Respondents:** Ruchika Tradelink…

## Timeline

- **2019-01-01 — CP (IB) No. 78…**: Filing of CP (IB) No.…
- **2020-02-03 — Order for Commencement…**: Order passed for commencement of liquidation…

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