The Mumbai bench of the National Company Law Tribunal (NCLT) has held that a corporate debtor cannot be directly dissolved under the Insolvency and Bankruptcy Code without first undergoing the insolvency and liquidation process.
The bench of Judicial Member K. R. Saji Kumar and Technical Member Anil Raj Chellan observed:
“A plain reading of Section 54 makes it clear that an application for dissolution of the Corporate Debtor is to be filed by the Liquidator and not by the IRP/RP of the Corporate Debtor. Further, the application for dissolution is to be filed after the assets of the Corporate Debtor have been completely liquidated.”
It further observed:
“In other words, an application for dissolution of the Corporate Debtor can…