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2020 (11) TMI 672 - Tri - Insolvency and BankruptcyDissolution of the Corporate Debtor - Section 54 of the IBC - Whether the pendency of any Investigation on the Corporate Debtor creates a bar for passing on order of dissolution of a Company? HELD THAT:- When a company gets dissolved under Section 248, it will cease to operate except for the purpose of realising the amount due to the company and for the payment or discharge of the liabilities or obligations of the company. Though the Legislature has specifically made such a provision when dissolution takes place by virtue of Section 248 of Companies Act 2013, such exception cannot be presumed to be available as a thumb rule in situations when dissolution takes place via other modes especially under the I & B Code, 2016, where no such provision is expressly available. It is evident that the pendency of an Investigation creates a bar for RoC to strike off the name of the Company from the register of companies, as well as for making an application for removal of the name of the Company - That it is an established fact that the moment the dissolution of a Company takes place, its legal entity ceases to exists, neither it can sue nor it can be sued in its own name. Thus, it is clear that the dissolution puts an end to the legal existence of a Company. Once a company is dissolved, it becomes a non-existent party and therefore, no action can be brought in its name. Further, the Liquidator shall also not be able to represent the non-existent Corporate Debtor before any of the investigating forum. In order to facilitate completion of investigation, maximisation of assets and the value thereof and to ensure smooth distribution of the proceeds arising out of such investigation amongst various stakeholders of the Corporate Debtor, the judicial propriety demands that the Corporate Debtor should not be dissolved at this stage when the investigation as ordered by Hon'ble NCLAT is pending - the pendency of an investigation creates a bar in ordering dissolution of the company. Application dismissed as premature.
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