The court emphasized the completion of the CIRP period and the viability of the Resolution Plan in comparison to the liquidation value, highlighting the possibility of selling the Corporate Debtor as a going concern even in the event of liquidation.

ORDER :

1. The Corporate Insolvency Resolution Process was initiated against Frontier Lifeline Private Limited (Corporate Debtor) in which the Appellant-First Step Ventures Limited filed a Resolution Plan. However, the Committee of Creditors would not consider the Resolution Plan due to completion of the Corporate Insolvency Resolution Process period of 270 days. At that stage, the Resolution Professional of Frontier Lifeline Private Limited filed application under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 (“I&B Code” for short) for exclusion of 43 days from 29th April, 2019 to 10th June, 2019 on the basis of the decision of the Committee of Creditors.

2. However, it was not allowed by the Adjudicating Authority (National Company Law Tribunal), Division Bench, Chennai, by impugned order dated 18th June, 2019 with following observations:

“Therefore, we are of the view that it is a fit case for liquidation on two grounds - (i) CIRP Period of 270 days is over (ii) even in the event of liquidation is ordered, it is still open to the Liquidator to sell the Corporate Debtor as a going-concern. Normally, the Resolution Plan is viable if the Resolution Plan Value is more than Liquidation Value, in this case, one - Plan is not approved by the CoC till date, two the Resolution Plan value is far below to the liquidation value, three not taking a decision by the CoC without any reason will not become a reason for exclusion of the time period. Besides this, CoC has not even passed a resolution seeking exclusion or extension of time as prayed by the Resolution Professional.

On these ground, the application for exclusion is hereby dismissed leaving it open to the Resolution Professional to take appropriate action in accordance with law.”

3. Learned counsel appearing on behalf of the Appellant-Resolution Applicant submitted that the Adjudicating Authority has wrongly held that the Committee of Creditors had not passed resolution seeking exclusion of the period as prayed for by the Resolution Professional.

4. Referring to the opening second paragraph of the impugned order, it was submitted that the Adjudicating Authority noticed that the Committee of Creditors asked the Resolution Professional to request for exclusion of the period and to take a call over the Resolution Plan submitted by the Appellant.

5. It is submitted that the Adjudicating Authority while granted 90 days extension by order dated 20th February, 2019, it was given effect from 29th January, 2019 thereby in fact 68 days of extension was granted.

6. It is submitted that further 22 days is excluded by extending the period from prospective date i.e. with effect from 20th February, 2019, the Committee of Creditors would have taken a call for the Resolution Plan submitted by the Appellant.

7. In the present case, the Appellant has not challenged the order dated 20th February, 2019 whereby 90 days period was granted from retrospective date. In such circumstances, we are not inclined to deliberate on the issue whether the extension of 90 days from the retrospective date is right or wrong in absence of such challenge. Now 270 days is being over as per calculation on the basis of the order of extension, we hold that in absence of any other reason, the Adjudicating Authority has rightly rejected the application for exclusion of certain period.

8. From the impugned order, it will be evident that the Adjudicating Authority has noticed that even during liquidation it is still open to the liquidator to sell the Corporate Debtor as a going concern.

9. In the present case, no order of liquidation has been passed but we accepted that the period of Corporate Insolvency Resolution Process is completed, appropriate order is required to be passed by the Adjudicating Authority. Even if an order of liquidation is passed by the Adjudicating Authority, in such case, the liquidator is to follow the procedure laid down under Section 230 of the Companies Act, 2013 in the light of the decision of this