# In the matter of Kridhan Infrastructure Pvt Ltd (now known as Krish Steel and Trading Pvt Ltd.) Vs. Venkatesan Sankaranarayan & Ors., Civil Appeal No. 3299 of 2020

> SC judgment dated 2021-03-01. Citation: TCN-2021-SC-00071. The appeal arises from an order of the National Company Law Appellate Tribunal (NCLAT) dated 8…

- **Court:** SC
- **Order date:** 1 Mar 2021
- **Citation:** TCN-2021-SC-00071
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/kridhan-infrastructure-pvt-ltd-now-known-as-krish-steel-and-trading-pvt-ltd-vs-v-1752b68b

## Summary

### Background

The appeal arises from an order of the National Company Law Appellate Tribunal (NCLAT) dated 8 September 2020. The appellant, Kridhan Infrastructure Pvt Ltd, submitted a Resolution Plan for Tecpro Systems Limited, which was undergoing the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC) 2016. The Resolution Plan was approved by the Committee of Creditors (CoC) on 8 March 2019 and by the National Company Law Tribunal (NCLT) on 15 May 2019. The appellant deposited Rs 5 Crores in an Escrow Account of the Corporate Debtor. However, the appellant failed to fulfill its further obligations, including equity infusion. The CoC voted for the liquidation of the Corporate Debtor on 11 November 2019, due to the appellant's failure to

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## Facts

Kridhan Infrastructure Pvt Ltd (appellant) submitted a Resolution Plan for Tecpro Systems Limited (corporate debtor), which was undergoing CIRP. The Resolution Plan was approved by the CoC and the NCLT. The appellant deposited Rs 5 crores in an escrow account. The appellant failed to fulfill further obligations, including equity infusion. The CoC voted for liquidation due to the appellant's failure to implement the plan. The NCLT allowed liquidation, and the NCLAT upheld the order. The Supreme Court granted the appellant an opportunity to deposit Rs 50 crores, later extended. The appellant was unable to raise funds because term lenders required the company's status to be changed from 'under liquidation' to 'active'. The appellant had already deposited Rs 20 crores,

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## Issues and analysis

### Issue 1: Whether the appellant, Kridhan Infrastructure Pvt Ltd, should be granted further opportunities to …

**Ratio:** Liquidation of the Corporate Debtor should be a matter of last resort. The IBC recognizes

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**Reasoning:** The court considered the appellant's submissions regarding difficulties in raising funds

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**Interpretation:** The court interpreted the IBC's objective as resolving corporate insolvencies

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**Application:** The court applied the ratio by acknowledging the principle that liquidation

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## Parties

- **Judges:** Dr Dhananjaya Y…; M.R.…
- **Appellants:** Kridhan Infrastruc…
- **Respondents:** Tecpro Systems…; Venkatesan…

## Timeline

- **2016-01-01 — Insolvency and…**: Insolvency and Bankruptcy…
- **2017-08-07 — CIRP Init…**: The corporate insolvency resolution process (CIR process) was initiated against the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33 — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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