The National Company Law Tribunal (NCLT) at Delhi has recently held that Section 10 of the Insolvency and Bankruptcy Code (IBC) cannot be invoked merely to wind up or dissolve a company. The provision is intended to resolve insolvency and revive businesses, the tribunal observed.
A bench of Judicial Member Ashok Kumar Bhardwaj and Technical Member Atul Chaturvedi observed:
“Thus, for the purpose of dissolution of a Company, the process under Section 10 of IBC, 2016, is not an advisable process. The process is meant for resolution of insolvency of CD, rescuing it and putting it back to its feet. The liquidation or dissolution of Corporate Debtor is a development incidental to failure of resolution of insolvency. Thus, if the object and…