Under Section 33(3) of the IBC, if an approved Resolution Plan is contravened by the corporate debtor or the successful resolution applicant, the Adjudicating Authority may order liquidation upon application by a person whose interests are prejudicially affected.

Headnote:The matter involves an application filed under Section 33(3) of the Insolvency and Bankruptcy Code, 2016, seeking the liquidation of the Corporate Debtor. The facts reveal that a Resolution Plan was approved by the Adjudicating Authority under Section 31, but the Successful Resolution Applicant failed to make the first payment due on 26.06.2024 and failed to adhere to subsequent revised timelines. The sole Financial Creditor expressed its decision to proceed with liquidation due to the non-implementation of the plan. The primary issue is whether the contravention of an approved Resolution Plan by the Successful Resolution Applicant justifies a liquidation order under Section 33(3) of the Code. The court observed that the approved Resolution Plan failed at the implementation stage and the obligations remained unfulfilled, noting that "the Successful Resolution Applicant has failed to comply with the obligations set out in the approved Resolution Plan." The Present Application viz. IA(IBC)(Liq.)/40/2025 in Company Petition no. 4238(MB)/2018 stands allowed.

Table of Content
1. procedural history of cirp and failure of the successful resolution applicant to implement the approved plan. (Para 1 , 2)
2. court's verification of payment defaults and lack of application for modification of the plan. (Para 3 , 4 , 5 , 6)
3. application of section 33(3) ibc regarding liquidation due to contravention of approved plan. (Para 7 , 8)
4. ordering of liquidation, appointment of liquidator, and cessation of board powers. (Para 9 , 10 , 11 , 12 , 13 , 14)

ORDER

1. This Application is filed by the Resolution Professional (Applicant/Chairperson of the Monitoring Committee) under Section 33(3) of the Insolvency and Bankruptcy Code, 2016 (Code) for initiating the liquidation process of AG Conveying Systems Private Limited (Corporate Debtor).

2. The facts leading to the filing of this application are as follows:

a) The Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor commenced vide order dated 03.12.2019. The Applicant was initially appointed as the Interim Resolution Professional (IRP) and later on confirmed as the Resolution Professional (RP) of the Corporate Debtor.

b) During the CIRP, the Applicant caused Public Announcement inviting claims from the creditors of the Corporate Debtor. Thereafter, the Committee of Creditors (CoC) was constituted. The CoC consists solely of the Bank of Maharashtra, with 100% voting share.

c) The RP published Form G for the invitation of Expression of Interest (EoI) on 12.02.2020 with the approval of the CoC. Pursuant thereto, Shri Shripad Gopal Apte submitted a Resolution Plan for the Corporate Debtor (Original Resolution Plan). The Original Resolution Plan was approved by the CoC with 100% voting share. The Applicant also filed IA No. 1763/2020 for approval of the Original Resolution Plan.

d) During the pendency of the application for approval of the Original Resolution Plan, an Application was filed by Employees' State Insurance Corporation (ESIC) seeking consideration of its claim, which came to be allowed by this Adjudicating Authority. Consequently, the Resolution Applicant revised the Resolution Plan by providing necessary treatment to the ESIC claim. Thereafter, the modified Resolution Plan was considered and approved by the CoC in its 11th Meeting held on 20.03.2023, and I.A. No. 5387 of 2023 was filed seeking approval of the Modified Resolution Plan.

e) Thereafter, the Applicant withdrew the applications for approval of Resolution Plans for fresh consideration by CoC as per the order dated 15.12.2023. The final Resolution Plan was approved by the CoC with 100% voting share in its 16th Meeting held on 15.03.2024.

f) Pursuant thereto, I.A. (IBC) (Plan) No. 24 of 2024 was filed under Section 30(6) of the Code seeking approval of the final Resolution Plan. This Adjudicating Authority vide Order dated 16.05.2024 approved the Resolution Plan under Section 31 of the Code. Subsequent to the same, a Monitoring Committee was constituted to implement the approved Resolution Plan.

g) The first meeting of the Monitoring Committee was held on 03.06.2024. The certified copy of the approval order was received on 05.06.2024 and communicated to the Successful Resolution Applicant on 06.06.2024. As per the implementation schedule contained in the approved Resolution Plan, the first payment became due on or before 26.06.2024.

h) In the Second Meeting of the Monitoring Committee held on 27.06.2024, Bank of Maharashtra, being the sole Financial Creditor of the Corporate Debtor, informed the Monitoring Committee that the Successful Resolution Applicant had failed to make payment in accordance with the approved Resolution Plan. Though the Successful Resolution Applicant sought extension of time and proposed revised timelines, no payment was made in terms of the approved Resolution Plan.

i) In the Third Meeting of the Monitoring Committee held on 29.08.2024, it was recorded that the Successful Resolution Applicant has failed to implement the approved Resolu

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