The National Company Law Tribunal (NCLT) is a quasi-judicial body in India that adjudicates matters related to companies, insolvency, and bankruptcy. Recently, the NCLT in Chennai has issued an order for the dissolution of MS Pillar Industries India Private Limited under Section 59 of the Insolvency and Bankruptcy Code (IBC).
The company had been undergoing corporate insolvency resolution process (CIRP) since 2019, which is a mechanism under the IBC to revive insolvent companies. During the CIRP, the company was required to come up with a resolution plan within a stipulated time period. However, in this case, the company failed to find a resolution plan within the given time, and as a result, the NCLT ordered the liquidation of the company.
The liquidation process involves the appointment of a liquidator, who takes control of the company’s assets and liabilities and is responsible for selling off the assets to repay the creditors. In this case, the liquidator appointed by the NCLT will carry out the process of selling the company’s assets, and the proceeds from the sale will be used to repay the creditors.
This order highlights the importance of timely resolution plans in the CIRP process under the IBC. Companies undergoing CIRP should strive to find a resolution plan within the given time period, failing which they may face liquidation and dissolution under the law. It also underscores the consequences of non-compliance with the provisions of the IBC, which can lead to severe penalties and legal action.
In conclusion, the NCLT’s order for the dissolution of MS Pillar Industries India Private Limited serves as a reminder of the importance of complying with the provisions of the IBC and the need for timely resolution plans in the CIRP process. It also serves as a warning to other companies undergoing CIRP to adhere to the timelines and requirements stipulated under the IBC to avoid facing similar consequences.
Written by Nidhi Bhadauriya a 2nd semester BA.LLB student from Vivekananda institute of professional studies
0 Comments