# In the matter of Sholingur Textiles Limited

> NCLT judgment dated 2024-01-25. Citation: TCN-2024-NCLT-02877. The application IA(IBC)/18(CHE)/2024 was filed by the Liquidator of the Corporate Debtor, M/s.…

- **Court:** NCLT
- **Order date:** 25 Jan 2024
- **Citation:** TCN-2024-NCLT-02877
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sholingur-textiles-limited-5d092102

## Summary

### Background

The application IA(IBC)/18(CHE)/2024 was filed by the Liquidator of the Corporate Debtor, M/s. Sholingur Textiles Limited, under Regulation 45(3) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, read with Section 60(5) of IBC, 2016, seeking closure of the liquidation process. The Tribunal had previously ordered the liquidation of the Corporate Debtor on 13.02.2020 and appointed the applicant as the Liquidator. The liquidation period was extended until 31.12.2023. The scheme approval process under Section 230-232 of the Companies Act, 2013, commenced on 20.03.2020, and the scheme chosen by the stakeholders was implemented. The Successful Scheme Proponents remitted the Scheme Settlement Amount, which was distributed to the

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## Facts

The Liquidator of Sholingur Textiles Limited filed an application seeking closure of the liquidation process. The Tribunal had ordered liquidation on 13.02.2020, appointing the applicant as Liquidator. The liquidation period was extended to 31.12.2023. A scheme of compromise and arrangement under Sections 230-232 of the Companies Act, 2013, was implemented. The Successful Scheme Proponents remitted the settlement amount, which was distributed to creditors. The Corporate Debtor's assets were handed over to the Successful Scheme Proponents, and the RoC reverted the company's status to 'Active'. The Resolution Professional had filed cases relating to preferential transactions, which were heard by the Tribunal, and appeals were filed before the NCLAT and Supreme Court. The

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## Issues and analysis

### Issue 1: Whether the liquidation process of the Corporate Debtor, Sholingur Textiles Limited, should be …

**Ratio:** The legal principle applied is that if a company under liquidation is revived through a

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**Reasoning:** The Tribunal reasoned that the Scheme of Compromise & Arrangement had been approved

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**Interpretation:** This legal issue involves the interpretation of the IBC and the Companies Act,

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**Application:** In this case, the Tribunal applied the ratio by considering the facts that the

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## Parties

- **Judges:** SANJIV…; Venkataraman…
- **Respondents:** Sholingur…
- **Advocates:** Ravi Rajag…

## Timeline

- **2020-02-13 — Liquidation…**: The Tribunal ordered the liquidation of the Corporate Debtor and appointed the Applicant…
- **2020-03-20 — Scheme Approval Process…**: The Scheme approval process under Section…

## 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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