File.
| Photo Credit: Vijay Soneji
The National Company Law Tribunal (NCLT) has ordered liquidation of jewelry retailer Gitanjali Gems, promoted by absconding diamantaire Mehul Choksi, underneath Section 33 of the Insolvency and Bankruptcy Code, 2016.
The bench additionally appointed Santanu T Ray because the liquidator, who will full the liquidation course of as per the provisions of the IBC, 2016, based on an NCLT order, filed on BSE.
The decision skilled of the jewelry retailer, Vijay Kumar Garg, filed the appliance for liquidation in NCLT.
Garg knowledgeable the tribunal that on account of the alleged fraud perpetrated by Gitanjali Gems and its officers, the affairs have been underneath investigation by a number of regulation enforcement companies just like the Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI).
He mentioned that the ED had issued orders attaching the properties of Choksi.
In his utility, Garg knowledgeable the tribunal that instantly after the appointment he wrote to varied investigation authorities (together with the Directorate of Enforcement and the CBI) requesting for particulars and entry to such properties, belongings, shares and information of Gitanjali Gems to proceed additional with the CIRP.
However, the authorities denied Garg’s request and refused to raise the attachment over the properties of Gitanjali Gems in CIRP.
Garg additional mentioned that because the 180-day period of the CIRP had already expired in April 2019, and with the corporate missing ongoing enterprise operations, the possibilities of the corporate’s revival have been bleak.
Hence, he submitted an utility to provoke the liquidation course of. He additionally declined to function the liquidator.
The NCLT, in its order, noticed that as a result of ongoing investigations, attachment of belongings and the low probability of insolvency decision, it was essential to proceed with the liquidation of Gitanjali Gems.
Further, the order noticed that “the CoC (Committee of Creditors) with requisite voting … has approved the liquidation of Corporate Debtor in view of bleak chances of receiving any resolution plan… This Tribunal has very limited powers of judicial review in such matters of commercial wisdom.” Hence, the tribunal ordered the liquidation of Gitanjali Gems.
Gitanjali Gems, with liabilities of over Rs 12,558 crore, was admitted underneath the Corporate Insolvency Resolution Process (CIRP) in October 2018.
