Liquidation after Rejection of Competing Resolution Plans by CoC

The National Company Law Tribunal ordered liquidation of Shreem Corporation Limited under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 after the Committee of Creditors rejected all competing resolution plans and resolved with overwhelming majority to liquidate the Corporate Debtor. 

The Tribunal held that once the Committee of Creditors, exercising its commercial wisdom, rejects the available resolution plans and resolves to liquidate the Corporate Debtor, the Adjudicating Authority is statutorily obligated to pass a liquidation order in terms of Section 33 of the Code. 

The ruling also highlights the extensive procedural complexities that may arise during CIRP, including appellate challenges before the NCLAT and Supreme Court, disputes involving attached properties before the Bombay High Court, repeated exclusions and extensions of CIRP timelines, and structured competitive processes for resolution plan evaluation.