In India, the bad debts are going on increasing.

Compared to any other country, the process of resolving

the insolvency is time consuming. This makes our country to become weak in economy.

A Detailed Study on Voluntary Liquidation of Corporate Person Under The Insolvency And Bankruptcy
Code, 2016

Abstract

In India, the bad debts are going on increasing. Compared to any other country, the process of resolving
the insolvency is time consuming. This makes our country to become weak in economy. Among the total
bad debts, the corporate debts constitute 56%. These all lead to pending of thousands of litigations
before the courts for recovery of money. The existed Acts such as the Presidency Towns Insolvency Act,
1909 and the Provincial Insolvency Act, 1920 dealing with the insolvency in case of individuals are
centuries old. These issues were solved by the enactment of Insolvency and Bankruptcy Code, 2016. The
Code mainly focused on maximisation of the value of debtor’s assets. The Code gives a clear idea about
the insolvency resolution process. This article mainly focuses on the concept of voluntary liquidation of
company. It explains about the procedure involved in the process of voluntary liquidation of a corporate
person. This is mainly distinguished from the voluntary winding up of companies under the Companies
Act, 2013. The main focus of the article is declaration of solvency, general meeting for initiating
voluntary winding up, intimation to other regulatory authorities, effect of voluntary liquidation, the
dissolution of corporate debtor and finally the punishment under the code for fraudulent or malicious
initiation of proceedings.

Introduction

The Insolvency and Bankruptcy Code (2016) is a significant code. The speed at which the legislation was
enacted and how it is made operational along with detailed rules and regulations have amazed many.
The code gives a clear distinction between Insolvency[1] and Bankruptcy[2]. This Code deals with two
aspects. One is the Insolvency Resolution and Liquidation of Corporate Entities. The other is the
Bankruptcy of individuals and corporate firms.

Concept Note

This article mainly focuses on the procedures prescribed under the Insolvency and the Bankruptcy Code,
2016 relating to the Voluntary Liquidation of corporate person.
Research Objectives

The main objective of this research is to bring into the light the procedure for voluntary liquidation of a
corporate person that is mentioned under the Insolvency and the Bankruptcy Code, 2016. This research
also focuses whether the companies are able to cope up with the procedure for voluntary liquidation
prescribed under this Code.

Research Questions

- Whether the procedure given under the Insolvency and Bankruptcy Code, 2016 is simple for the
companies to follow?

- Whether there is any difficulty in following the procedure for voluntary liquidation under Section 59 of
the Code?

- Whether the procedure for voluntary liquidation given under the Code is similar to procedure for
voluntary winding up of companies under the Companies Act, 2013?

Meaning of Insolvency And Bankruptcy Under The Code

The Code gives a clear distinction between Insolvency and Bankruptcy.

Insolvency:

The term Insolvency has not been defined under the Code. However, Insolvency means short term
inability to meet the liabilities during the normal course of business. It can be resolved by changing the
repayment plan of loans. If it cannot be resolved, then a legal action may be taken against the insolvent.
In this case, the assets of the insolvent will be sold to pay back the outstanding debts. Generally an
official assignee or liquidator is appointed by the Government of India. The official assignee or the
liquidator will allocate the assets of the insolvent to the insolvents creditor.

Bankruptcy:

The term Bankruptcy has not been defined under the Code. However, Bankruptcy means long term
inability to meet the liabilities. It slightly differs from insolvency. It means that a person voluntarily
declares himself as an insolvent and approaches the Court. On doing so, the Court is responsible to
liquidate the personal property of the insolvent and hand it over to his creditors. Thus it provides a fresh
lease of life to the insolvent.

Insolvency And Bankruptcy Code, 2016

The Insolvency and Bankruptcy Code have consolidated the Insolvency, Bankruptcy and Liquidation laws
for companies, partnership firms, limited liabilities partnership and individuals in India which are
contained in various enactments into a single Code. It came into effect on 28 May 2016. The main aim of
the Code is to consolidate the law related to insolvency and bankruptcy. Thus the Code seeks to shift the
winding up process by creditors and voluntary winding by members of the company from the
Companies Act, 2013 to the Code. Another important feature of this code is that, it does not make
distinction between international and domestic creditors. It also does not distinguish between the
classes of financial institutions.

In this regard, the Ministry of Corporate Affairs (MCA) on March 30, 2017 notified Section 59 of the
Code, 2016 as Voluntary winding up of a corporate person. In furtherance of this the Insolvency and
Bankruptcy Board of India issued the Insolvency and Bankruptcy Board of India (Voluntary Liquidation)
Regulations, 2017[3]. The Insolvency and Bankruptcy Code repeals the Presidency Towns Insolvency Act,
1909[4] and Provincial Insolvency Act, 1920[5]. In spite of this the Code amended the 11 legislations. The
important legislations amended by this Code are:

- Indian Partnership Act, 1932[6]

- The Companies Act, 2013[7]

- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002[8]

- Limited Liability Partnership Act, 2008[9]

- Sick Industrial Companies (Special Provisions) Repeal Act, 2003[10]

Voluntary Liquidation of Companies Under The Code

Under Chapter V, Section 59 of the Insolvency and Bankruptcy Code, 2016 deals with voluntary
liquidation of corporate persons. Section 59(1) of the Code explains that, a corporate person who is
intending to liquidate it voluntarily and has not committed any default may initiate voluntary liquidation
proceedings under the provisions of this chapter. Section 59(2) states that the voluntary liquidation in
case of corporate person under sub-section (1) shall follow the procedural requirements and meet the
conditions as may be prescribed by the Insolvency and Bankruptcy Board.

Provisions required to be referred for Voluntary Winding Up of a company:

- Section 59 of Insolvency and Bankruptcy Code, 2016

- Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017

- Section 35 to 53 of the Insolvency and Bankruptcy Code, 2016 read with Insolvency and

- Bankruptcy (Liquidation Process) Regulations, 2016

- Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016

The Regulatory authorities for dealing with Voluntary Winding Up of companies:

The Insolvency and Bankruptcy Board of India[11]

Registrar of Companies[12]

National Company Law Tribunal (NCLT)[13]

Procedure For Voluntary Liquidation of A Company

Declaration of Solvency:

Section 59(3)(a)(i) of the Insolvency and Bankruptcy Code, 2016 says that a declaration from majority of
the Directors stating that they have made a full enquiry about the affairs of the company and they have
formed the opinion that the company has no debt or in case it has debts it will be able to pay its debts
completely from the value obtained from the assets to be sold in the voluntary liquidation. Section
59(3)(a)(ii) states that in case of voluntary winding up of a company, the company must state that it is
not being liquidated to defraud any person. In this case, an affidavit verifying the above must be
submitted from the majority of the directors.

The declaration under sub-section (a) must be accompanied with the following documents. They are
specified under Section 59(3)(b) of the Code.

The documents are:

i) Audited financial statements and record of business operations of the company for previous two years
or for a period since its incorporation, whichever is later.

ii) A report of valuation of the assets of the company, in case if it is prepared by a registered valuer.

After the declaration is filed, a board meeting shall be held to approve the declaration and proposal for
winding up of the company. Then the company’s bank account shall be closed and a liquidation account
will be opened. There is no provision under the Code for filing a declaration with the authority like the
Companies Act, 1956[14] which gives the prescribed provision for this. However, it is recommended to
file the same with RoC in Form GNL-2[15].

General Meeting for initiating Voluntary Winding Up:

Section 59(3)(c) explains about the general meeting for initiating voluntary winding up of corporate
persons. Within four weeks of the declaration under sub-section (a),

i) There shall be a special resolution by the members of the company in a general meeting requiring the
company to be liquidated voluntarily and also it empowers the appointment of insolvency
professional[16] to act as a liquidator.
ii) There shall also be a resolution of the members of the company in a general meeting requiring that
the company to be voluntarily liquidated as a result of expiry of the period of its duration if it is fixed by
the articles of association[17] of the company or on the occurrence of any event which the articles
provide, that the company shall be dissolved and if it is dissolved, the company may appoint an
insolvency professional to act as the liquidator.

It also provides that, if a company owes any debts to any person, creditors representing two-thirds in
value of the debts of the company, then the company shall approve the resolution passed under sub-
clause (c) and such approval must be made within seven days of such resolution.

Intimation to other regulatory authorities:

Under sub-section (4), it is held that the company shall inform to the Registrar of Companies and the
Board about the resolution under sub-section (3) to liquidate the company within seven days of such
resolution or on the subsequent approval by the creditors. If the creditors approved under sub-section
(3), then the voluntary liquidation shall be commenced from the date of passing of the resolution under
sub-section (3)(c) which is explained under Section 59((5).

Application of Sections 35 to 53 of the Code:

Sub-section (6) of Section 59 says that, Sections 35 to 53 of Chapter III and VII shall apply to voluntary
liquidation proceedings of corporate persons. Chapter III deals about liquidation process of a corporate
person in case of incompletion of insolvency resolution process and the NCLT orders for liquidation of
corporate persons. Chapter VII deals with offences and penalties. It is also provided that the liquidator in
case of voluntary winding up of companies shall prepare a report on quarterly basis and submit the
report to the Registrar of Companies or to the Board.

Sub-section (7) of Section 59 explains that where the affairs of the company have been completely
wound up and the company’s assets are completely liquidated, then the liquidator[18] shall make an
application to the Adjudicating authority[19] for the dissolution of such corporate person.

Dissolution of Corporate debtor:

Under sub-section (8) of Section 59 deals about the dissolution of corporate debtor[20]. This sub-section
says that, the Adjudicating Authority, on the application filed by the liquidator under the sub-section (7),
shall pass an order that the corporate debtor shall be dissolved from the date of the issuance of the
order and the corporate debtor shall be dissolved accordingly. A copy of the order issued by the
Adjudicating authority under this sub-section, within fourteen days from the date of such order, shall be
forwarded to the authority with which the corporate person is registered[21].

Public announcements and claims:

Regulation 14(1) of the Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process)
Regulations, 2017, deals about the public announcements and claims. The liquidator shall make a public
announcement in Form A of Schedule within five days from his appointment about the liquidation of the
company. Sub-regulation (2) states that the Public announcement shall call upon the stakeholders to
submit their claims as on the liquidation commencement date[22] and he must provide the last date for
submission of claim, that is thirty days from the commencement of liquidation date. Sub-regulation (3)
states that the announcement shall be published in the official Gazette, in one English and one regional
language newspaper[23], on the website of the corporate person if it is available and on the website, if
any, designated by the board for this purpose.

Chapter V of Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017
deals about various claims which includes;

· Claims by operational creditors – Regulation16

· Claims by financial creditors – Regulation 17

· Claims by workmen and employees – Regulation 18

· Claims by other stakeholders – Regulation 19

Realisation of Assets:

Chapter VI of the Regulation 2017 deals with the realisation of assets under regulations 31[24] to 33[25].
The liquidator may value the property of the corporate person and sell it in any manner and through any
mode that is approved by the corporate person. Chapter VII deals with Proceeds of liquidation and
distribution of proceeds under regulations 34[26], 35[27] and 36[28]. The liquidator shall distribute the
proceeds to the stakeholders[29] within six months from the receipt of amount.
Registers and books of accounts:

Regulation 10 of the Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process), 2017
explains about the Registers and books of accounts to be maintained by the Liquidator. Regulation 10(2)
states that the liquidator shall maintain the books and registers in case of voluntary liquidation of the
corporate person. The liquidator must preserve the books and the registers for a period of eight years
after the dissolution of the corporate person. The books and registers to be maintained are as follows:

Cash book[30]

b) Ledger

c) Bank Ledger

d) Register of fixed assets and inventories

e) Securities and Investment Register

f) Register of Book Debts and Outstanding Debts

g) Tenants Ledger[31]

h) Suits Ledger

i) Decree Register

j) Register of Claims and Dividends

k) Contributories Ledger

l) Distributions Register

m Fee Register

n) Suspense Register

o) Documents Register

p) Books Register

q) Register of unclaimed dividends and undistributed properties deposited in accordance with

Regulation 39[32] and

r) Such other books or registers as may be necessary to account for transactions entered into by him in
relation to the corporate person.

Sub-regulation (3) states that the registers and books under the sub-regulation (2) may be maintained in
the forms which are given under the Schedule II, which certain modifications as the liquidator may think
fit in the facts and circumstances of the voluntary liquidation. Sub-regulation (4) states that the
liquidator shall keep receipts of all the payments or expenses made by him.

Effect of Voluntary Liquidation of status of Corporate Person:

Regulation 6 of Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations,
2017 states the effect of Voluntary Liquidation of status of corporate person. The Corporate person
from the voluntary liquidation commencement date shall cease to carry on its business except in case of
the beneficial winding up of the business.
Completion of Liquidation:

Regulation 37 of Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulation,
2017 deals with completion of liquidation. The liquidator shall aim to wind up the affairs of the
corporate person within one year from the voluntary liquidation commencement date. If the voluntary
liquidation is continuing for more than one year, then the liquidator shall call a meeting of the
contributories of the corporate person. He shall call for a meeting within 15 days from the end of the
year in which he is appointed as a liquidator and also at the end of each succeeding year. The liquidator
shall also present a status report indicating the progress in the liquidation. It shall include settlement of
list of stakeholders, details of any property that remains to be sold and realized, distribution made to
the stakeholders, development in any material litigation etc. The Status Report shall be enclosed with an
audited account of the voluntary liquidation and the report must show the receipts and payments
relating to liquidation from the liquidation commencement date.

Final Report prior to dissolution:

Regulation 38 of Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process), 2017 deals
with the final report prior to dissolution. The Sub-regulation (1) states that, when the affairs of the
corporate person are fully wound up, the liquidator shall prepare a final report consisting of an audited
account of voluntary liquidation showing the receipts and payment relating to liquidation from the date
of commencement of liquidation[33] and also a statement demonstrating that the assets of the
corporate person have been disposed of, the debt of the corporate person has been discharged which
satisfies the creditors and also to demonstrate that no litigation is pending against the corporate person.
Along with this, the liquidator shall also give a final report regarding a sale statement in respect of all the
assets containing the realized value, cost of realization if it is there, the manner and mode of sale, the
person to whom the sale is made and any other details of the sale. The sale statement shall also include
a report if the value realized is less than the value assigned by the registered valuer in the report of
valuation of assets prepared in accordance with Section 59(3)(b) of the Code, 2016 or Regulation 3(2)(b)
of 2017 Regulation[34].

Sub-regulation (2) states that, the liquidator shall send the final report to the contributories of the
corporate person, the Registrar and the Board. The liquidator shall send the report by registered post at
their registered address and by electronic means. Sub-regulation (3) states that, the liquidator shall
submit the final report to the Adjudicating Authority along with the application under Section 59(7) of
Insolvency and Bankruptcy Code, 2016.

National Company Law Tribunal:

Section 60 of the Act deals with Adjudicating Authority for corporate persons. As per sub-section (1) of
Section 60, the Adjudicating Authority shall be National Company Law Tribunal (NCLT), in relation to
insolvency resolution and liquidation for corporate persons including the corporate debtors and
personal guarantors. It is to be noted that the NCLT will have territorial jurisdiction over the place where
the registered office of the corporate person is located. Sub-section (4) of section 60 says that, the
National Company Law Tribunal shall have all the powers of the Debt Recovery Tribunal[35].

Punishments:

Section 65 of the Code deals about the fraudulent or malicious initiation of proceedings. Sub-section (2)
of Section 65 deals mainly about the punishment imposed fraudulent voluntary liquidation proceedings.
It explains that, if any person initiates voluntary liquidation proceedings with the intent to defraud any
person, the Adjudicating Authority may impose upon such person, a penalty which shall not be less than
one lakh rupees but may extend to one crore rupees.

Research Findings

· From the above research, it is clear that the procedure given under the Insolvency and the Bankruptcy
Code, 2016 regarding the Voluntary Liquidation of Corporate person is simple procedure and not too
complicated and the companies must follow this procedure in case the company is to wind up due to
insolvency.

· The procedure given for voluntary liquidation of a corporate person under this Code is simple and thus
there is no difficulty in following the procedure and non-compliance of the procedure is a punishable
offence under Section 65 of the Code.

· It is also noted that, the procedure for voluntary liquidation of the Corporate Person under the Code is
different from the procedure for Voluntary winding up of companies as enumerated in the Companies
Act of 2013. The Companies Act, 2013 deals with voluntary liquidation of companies under Sections 304
to 325.

· The voluntary winding up of companies under the Companies Act, 2013 is segregated into 2 categories.
They are

i) Members voluntary winding up

ii) Creditors voluntary winding up

This distinction is eliminated under the Insolvency and Bankruptcy Code, 2016. Under Section 59 of the
Code, only a corporate person is allowed to initiate voluntary liquidation process, which has not
committed any default.

Conclusion

The Insolvency and Bankruptcy Code, 2016 gives a clear cut distinction between insolvency and
bankruptcy. The details discussed in this article relates to Voluntary winding up of corporate person
under the Code. The Code gives a crystal clear procedure in case of voluntary liquidation of corporate
person under Section 59. Together with the Code, the Insolvency and Bankruptcy Board of India
(Voluntary Liquidation Process) Regulation, 2017 also explains about the process involved in the
voluntary winding up of the companies. Starting from the declaration of solvency to the final report is
explained in a detailed manner in the Code and the Regulation. Even though the Code does not define
the terms “Insolvency” and “Bankruptcy”, it explains about the process of winding up of insolvent and
bankrupt corporate persons evidently. The Code has given more responsibility to the liquidator to
comply with the provisions of the Code. Thus the liquidator should be well versed in this Code. The
Regulation also explains about the realisation of assets and the distribution of the proceeds, effect of
voluntary liquidation and also the books and the registers to be maintained by the liquidator in case of
voluntary liquidation.

References

Bare Acts:

1) Insolvency and Bankruptcy Code, 2016

2) Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulation, 2017

3) The Companies Act, 2013

4) Insolvency and Bankruptcy (Liquidation Process) Regulations, 2016

5) Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016

6) Presidency Towns Insolvency Act, 1909

7) Provincial Insolvency Act, 1920

End-Notes

[1] General meaning of Insolvency is the state of being unable to pay the money owed, by a person or
company on time; those in a state of insolvency are said to be insolvent. There are two forms of
insolvency. They are cash-flow insolvency and balance-sheet insolvency.

[2] General meaning of Bankruptcy is a legal status of a person or other entity that cannot repay the
debts it owes to creditors. Bankruptcy is not the only legal status that an insolvent person may have, and
thus the term bankruptcy is therefore not a synonym for insolvency. In most jurisdictions, bankruptcy is
imposed by a court order, often initiated by the debtor.

[3] In exercise of the powers conferred by sections 59, 196 and 208 read with section 240 of the
Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Board made the Insolvency and Bankruptcy
Board of India (Voluntary Liquidation) Regulations, 2017. These Regulations shall apply to the voluntary
liquidation of corporate persons under Chapter V of Part II of the Insolvency and Bankruptcy Code, 2016.

[4] Act No. 3 of 1909 1 [12th March, 1909]. An Act to amend the law of insolvency in the Presidency-
towns 2.

[5] Act No. 5 of 1920 [25th February, 1920]. An Act to consolidate and amend the law relating to
Insolvency 1 as administered by Courts having jurisdictions outside the Presidency-towns.

[6] Act No. 9 of 1932. [8th April, 1932]. An Act to define and amend the law relating to Partnership.

[7] Act No. 18 of 2013. [29th August, 2013]. An Act to consolidate and amend the law relating to
companies.

[8] Act No. 54 of 2002. An Act to regulate securitisation and reconstruction of financial assets and
enforcement of security interest and matters connected therewith or incidental thereto.

[9] Act No. 6 of 2009. [7th January, 2009], Act of Parliament. An Act to make provisions for the
formation and regulation of limited liability partnerships and for matters connected therewith or
incidental thereto.

[10] Act No. 1 of 2004. [1st January, 2004]. An Act to repeal the sick industrial companies (Special
Provisions) Act, 1985.

[11] The Insolvency and Bankruptcy Board of India (IBBI) is the most important institutional arrangement
for the new insolvency and bankruptcy regime. It was created as a referring institution with multiple
tasks including creation of regulations and control of agencies and professionals involved in the
insolvency and bankruptcy business. The IBBI was established on October 1, 2016 in accordance with the
provisions of the Insolvency and Bankruptcy Code, 2016. It was constituted as a technical committee
under the IBBI regulations, 2017. (Aug. 16, 2017, 10:06:10)

[12] Registrars of Companies (ROC) appointed under Section 609 of the Companies Act covering the
various States and Union Territories are vested with the primary duty of registering companies and LLPs
floated in the respective states and the Union Territories and ensuring that such companies and LLPs
comply with statutory requirements under the Act. Refer http://www.mca.gov.in. (Aug. 17, 2017,
01:05:47).

[13] The National Company Law Appellate Tribunal (NCLAT) is a quasi-judicial body in India that
adjudicates issues relating to companies in India. The NCLAT was established under the Companies Act
2013 and was constituted on 1 June 2016.

[14] Act No. 1 of 1956. An Act to consolidate and amend the law relating to companies and certain other
associations.

[15] It is a form for submission of documents with the Registrar of Companies.

[16] Section 19 of the Insolvency and Bankruptcy Code, 2016 defines an Insolvency Professional. It
means a person enrolled under section 206 with an insolvency professional agency as its member and
registered with the Board as an insolvency professional under section 207.

[17] As per Section 2(5) of the Companies Act, 2013, “articles” means the articles of association of a
company as originally framed or as altered from time to time or applied in pursuance of any previous
company law or of this Act. Section 5 of the Companies Act, 2013 deals with AOA. The articles of a
company shall contain the regulations from management of the company. The articles shall also contain
such matters, as may be prescribed. It shall not prevent a company from including such additional
matters in its articles as may be considered necessary for its management.

[18] Under this Code, the term “Liquidator” has been defined under Section 5(18). A liquidator means an
insolvency professional appointed as a liquidator in accordance with the provisions of Chapter III or
Chapter V of this part, as the case may be.

[19] An “Adjudicating authority” is defined under Section 5(1) of this Code. An Adjudicating officer for
the purposes of this Part, means National Company Law Tribunal constituted under section 408 of the
Companies Act, 2013.

[20] According to Section 3(8) of the Insolvency and Bankruptcy Code, 2016, “Corporate debtor” means
a corporate person who owes a debt to any person.

[21] Dealt under Section 59(9) of the Insolvency and Bankruptcy Code, 2016.

[22] Section 5(17) of the Insolvency and Bankruptcy Code, 2016 defines "liquidation commencement
date" means the date on which proceedings for liquidation commence in accordance with section 33 or
section 59, as the case may be.

[23] With wide circulation at the location of the registered office and principal office, if any, of the
corporate person and any other location where in the opinion of the liquidator, the corporate person
conducts material business operations.

[24] Regulation 31 of 2017 regulation deals with manner of sale.

[25] Regulation 32 and 33 deals with Recovery of monies due and Liquidator to realize uncalled capital
or unpaid capital contribution.

[26] Regulation 34 of Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process),
Regulations, 2017 explains about all money to be paid in to bank account.

[27] Regulation 35 of 2017 regulation deals with distribution of proceeds.

[28] Regulation 36 of 2017 regulation deals with Return of money.

[29] A person, group or organization that has interest or concern in an organization. Stakeholders can
affect or be affected by the organization’s actions, objectives and policies. Some examples of key
stakeholders are creditors, directors, employees, government (and its agencies), owners (shareholders),
suppliers, unions and the community from which the business draws its resources. Refer
http://www.businessdictionary.com/definition/stakeholder.html.

[30] A cash book is a financial journal that contains all cash receipts and payments, including bank
deposits and withdrawals. Entries in the cash book are then posted into the general ledger. Refer
http://www.investopedia.com/terms/c/cash-book.asp (Aug. 17, 2017,08:15:00).

[31] It's a record kept by landlords to keep track of tenants, lease dates, rental amount, security
deposits, dates that rent is due, last rent increases, other comments about tenants.

[32] It says about the unclaimed proceeds of liquidation or undistributed assets.

[33] Regulation 38(1)(a) of Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process)
Regulation,2017.

[34] Explanation: For the purpose of this Regulation, ‘assets’ include an asset, all assets, a set of assets
or parcel of assets, as the case may be, which are being sold.

[35] Section 3(1) of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 deals about the
establishment of tribunal. The section is as follows; The Central Government shall, by notification,
establish one or more Tribunals, to be known as the Debts Recovery Tribunal, to exercise the
jurisdiction, powers and authority conferred on such Tribunal by or under this Act.