# In the matter of Sri Janardhana Credits Limited

> NCLT judgment dated 2024-06-11. Citation: TCN-2024-NCLT-01184. The Liquidator of Sri Janardhana Credits Limited filed a Company Petition under Section 59(7)…

- **Court:** NCLT
- **Order date:** 11 Jun 2024
- **Citation:** TCN-2024-NCLT-01184
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sri-janardhana-credits-limited-93d74825

## Summary

### Background

The Liquidator of Sri Janardhana Credits Limited filed a Company Petition under Section 59(7) of the Insolvency and Bankruptcy Code, 2016, seeking the dissolution of the company after completing the voluntary liquidation process.

## Facts

Sri Janardhana Credits Limited was incorporated on May 23, 1988, under the Companies Act, 1956. Its registered office is in Coimbatore, with an authorized capital of Rs. 2,10,00,000 and a paid-up capital of Rs. 2,00,02,000. The company's primary business was to act as financiers, providing financing for various operations, including managing, purchasing, selling, hiring, and hire-purchase financing, and dealing in movable and immovable property. The Reserve Bank of India (RBI) cancelled the company's NBFC license on June 11, 2020 , via order DoS/CHe No. 933/13.23.621/2019-20. Following this, the directors decided to cease operations as the company was no longer conducting business or earning profits. The Board of Directors passed a resolution for voluntary liquidation

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## Issues and analysis

### Issue 1: Whether Sri Janardhana Credits Limited should be dissolved under Section 59(7) of the Insolvency …

**Ratio:** A company that has completed its voluntary liquidation process, distributed its assets,

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**Reasoning:** The company's NBFC license was cancelled by the RBI, leading to the cessation of business

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**Interpretation:** The court interpreted Section 59(7) of the IBC to mean that once the affairs of

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**Application:** Given that Sri Janardhana Credits Limited had ceased operations, liquidated all

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## Parties

- **Judges:** SANJIV…; Venkataraman…
- **Appellants:** Venkatesh…; Liquidator…
- **Respondents:** Janardhana…
- **Advocates:** For the Liquidator…; Ld. Cou…

## Timeline

- **May 23, 1988 — Company Incor…**: Sri Janardhana Credits Limited was…
- **June 11, 2020 — NBFC License Cancellatio…**: RBI cancelled the NBFC license of the Corporate Person via order DoS/CHe No.…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 59 — Voluntary liquidation of corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-59)

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