Nowhere in the world governed by rule of law, acquiring a debt free (zero debt) company is so easy and effortless as in India under the provisions of the Insolvency and Bankruptcy Code, 2016 ("IBC" or "the Act" or "the Code"). It is an unparalleled opportunity to the corporates and individuals with deep pockets and surplus cash, to acquire companies as a going concern, for less than their enterprise value, more or less, at a liquidation cost and thus save the time, resources and transition period to establish a new company in any suitable business sector and territory, of their choice. The scheme of the Act operates as follows.
It was held by the Hon'ble Supreme Court of India in the case of Innoventive Industries Ltd. v. ICICI Bank & Anr. - (2018) 1 SCC 407 that the scheme of the Code (with reference to a Corporate Debtor, which means a corporate person who owes a debt to any person as defined under the IBC) is to ensure that when a default takes place, in the sense that a debt becomes due and is not paid, the insolvency resolution process begins. Default is defined in Section 3(12) in very wide terms as meaning non-payment of a debt once it becomes due and payable, which includes non-payment of even part thereof or an instalment amount. For the meaning of "debt", we have to go to Section 3(11), which in turn tells us that a debt means a liability of obligation in respect of a "claim" and for the meaning of "claim", we have to go back to Section 3(6) which defines "claim" to mean a right to payment even if it is disputed. The Code gets triggered the moment default is of rupees one crore or more (Section 4).
The corporate insolvency resolution process may be triggered by the corporate debtor itself or a financial creditor or operational creditor. A distinction is made by the Code between debts owed to financial creditors and operational creditors. A financial creditor has been defined under Section 5(7) as a person to whom a financial debt is owed and a financial debt is defined in Section 5(8) to mean a debt which is disbursed against consideration for the time value of money. As opposed to this, an operational creditor means a person to whom an operational debt is owed and an operational debt under Section 5 (21) means a claim in respect of provision of goods or services.
"When it comes to a financial creditor triggering the process, Section 7 becomes relevant. Under the explanation to Section 7(1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor - it need not be a debt owed to the applicant financial creditor. Under Section 7(2), an application is to be made under sub-section (1) in such form and manner as is prescribed, which takes us to the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Under Rule 4, the application is made by a financial creditor in Form 1 accompanied by documents and records required therein. Form 1 is a detailed form in 5 parts, which requires particulars of the applicant in Part I, particulars of the corporate debtor in Part II, particulars of the proposed interim resolution professional in part III, particulars of the financial debt in part IV and documents, records and evidence of default in part V. Under Rule 4(3), the applicant is to dispatch a copy of the application filed with the adjudicating authority by registered post or speed post to the registered office of the corporate debtor. The speed, within which the adjudicating authority is to ascertain the existence of a default from the records of the information utility or on the basis of evidence furnished by the financial creditor, is important. This it must do within 14 days of the receipt of the application. It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the "debt", which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be."
"The scheme of Section 7 stands in contrast with the scheme under Section 8 where an operational creditor is, on the occurrence of a default, to first deliver a demand notice of the unpaid debt to the operational debtor in the manner provided in Section 8(1) of the Code. Under Section 8(2), the corporate debtor can, within a period of 10 days of receipt of the demand notice or copy of the invoice mentioned in sub-section (1), bring to the notice of the operational creditor the existence of a dispute or the record of the pendency of a suit or arbitration proceedings, which is pre-existing - i.e. before such notice or invoice was received by the corporate debtor. The moment there is existence of such a dispute, the operational creditor gets out of the clutches of the Code."
"On the other hand, as we have seen, in the case of a corporate debtor who commits a default of a financial debt, the adjudicating authority has merely to see the records of the information utility or other evidence produced by the financial creditor to satisfy itself that a default has occurred. It is of no matter that the debt is disputed so long as the debt is "due" i.e. payable unless interdicted by some law or has not yet become due in the sense that it is payable at some future date. It is only when this is proved to the satisfaction of the adjudicating authority that the adjudicating authority may reject an application and not otherwise."
"The rest of the insolvency resolution process is also very important. The entire process is to be completed within a period of 180 days from the date of admission of the application under Section 12 and can only be extended beyond 180 days for a further period of not exceeding 90 days if the committee of creditors by a voting of requisite percentage (66%) of voting shares so decides. It can be seen that time is of essence in seeing whether the corporate body can be put back on its feet, so as to stave off liquidation, within a maximum period of 330 days."
"As soon as the application is admitted, a moratorium in terms of Section 14 of the Code is to be declared by the adjudicating authority and a public announcement is made stating, inter alia, the last date for submission of claims and the details of the interim resolution professional who shall be vested with the management of the corporate debtor and be responsible for receiving claims. Under Section 17, the erstwhile management of the corporate debtor is vested in an interim resolution professional ("IRP") who is a trained person registered under Chapter IV of the Code. This interim resolution professional is now to manage the operations of the corporate debtor as a going concern under the directions of a committee of creditors ("CoC")appointed under Section 21 of the Act. Decisions by this committee are to be taken by a vote of not less than 66% of the voting share of the financial creditors. Under Section 28, a resolution professional, who is none other than an interim resolution professional who is appointed to carry out the resolution process, is then given wide powers to raise finances, create security interests, etc. subject to prior approval of the committee of creditors."
"Under Section 30, any person who is interested in putting the corporate body back on its feet may submit a resolution plan to the resolution professional ("RP"), which is prepared on the basis of an information memorandum. This plan must provide for payment of insolvency resolution process costs, management of the affairs of the corporate debtor after approval of the plan, and implementation and supervision of the plan. It is only when such plan is approved by a vote of not less than 66% of the voting share of the financial creditors and the adjudicating authority is satisfied that the plan, as approved, meets the statutory requirements mentioned in Section 30, that it ultimately approves such plan, which is then binding on the corporate debtor as well as its employees, members, creditors, guarantors and other stakeholders. Importantly, and this is a major departure from previous legislation on the subject, the moment the adjudicating authority approves the resolution plan, the moratorium order passed by the authority under Section 14 shall cease to have effect. The scheme of the Code, therefore, is to make an attempt, by divesting the erstwhile management of its powers and vesting it in a professional agency (IRP or RP), to continue the business of the corporate body as a going concern until a resolution plan is drawn up, in which event the management is handed over under the plan so that the corporate body is able to pay back its debts and get back on its feet. All this is to be done within a period of 330 days or else the chopper comes down and the liquidation process begins."
From the above mentioned procedure and the scheme, it is clear that a resolution applicant (Section 25 of IBC) can bid for and if successful, acquire a corporate debtor from the Resolution Professional, with approval of the Committee of Creditors. Once the resolution plan (Section 26 of IBC) is approved and sanctioned by the Adjudicating Authority {Section 5(1) of IBC} under Section 31 of the IBC, it is binding on all creditors, shareholders and all stakeholders in terms of Section 31, and the successful Resolution Applicant becomes the absolute owner of the Corporate Debtor as a going conern, with all its assets, workers, employees, land/ building, plant & machinery and all movable, tangible and intangible properties and rights interests, with respect to the acquired corporate debtor.
There is no specific section in the IBC, which declares that on successful acquisition of the corporate debtor by a resolution applicant on acceptance of its resolution plan by the Adjudicating Authority (appropriate Bench of the National Company Law Tribunal), all debts and claims of the corporate debtor shall stand extinguished or satisfied on the payment/ consideration being paid or discharged to the financial creditors/ operational creditors, in terms of the approved resolution plan. However, the law on this issue is finally settled by the Hon'ble Supreme Court of India and no more res-integra, by various prominent decisions keeping in view, the aims and objectives of the IBC and the provisions of Section 31 of the Act.
The Hon'ble Supreme Court, in the case of Committee of Creditors of Essar Steel India Ltd. (through authorized signatory) v. Satish Kumar Gupta & Ors. - (2020) 8 SCC 531 held that "when it comes to the resolution of distressed assets, the IBC is very clear. A successful resolution applicant cannot suddenly be faced with undecided claims after the resolution plan submitted by him has been accepted as this would amount to a hydra head popping up which would throw into uncertainty amounts payable by a prospective resolution applicant who successfully takes over the business of the corporate debtor. All claims must be submitted to and decided by the resolution professional so that a prospective resolution applicant knows exactly what has to be paid in order that it may then take over and run the business of the corporate debtor. This the successful resolution applicant does on a fresh slate, as has been pointed out by us hereinabove."
"There is no doubt whatsoever that the IBC is a beneficial legislation which puts the corporate debtor back on its feet, not being a mere recovery legislation for creditors. The interests of the corporate debtor have, therefore, been bifurcated and separated from that of its promoters, those who are in management. Thus, the resolution process under the IBC aims at finding a solution for the stressed assets of the corporate debtor. This process maximizes the value of the assets of the corporate debtor, and protects and preserves the same during the insolvency resolution process. The ultimate aim is to find a solution that is beneficial to all stakeholders, which includes the creditors, the corporate debtor, and the economy as a whole. Therefore, it is necessary that all claims against the corporate debtor, as on the insolvency commencement date, must be submitted to and decided by the resolution professional so that the successful resolution applicant takes over the corporate debtor on a fresh slate."
"It is important to bear in mind that the IBC is a comprehensive code, aimed at resolving the insolvency and bankruptcy crisis in India. The process envisaged under the Code ensures that the corporate debtor is revived and put back on its feet, with all its past liabilities extinguished, and the management and control of the corporate debtor is handed over to a successful resolution applicant who can take over the corporate debtor on a clean slate. The successful resolution applicant must, therefore, be given a fair chance to make the resolution plan work. Any attempt to thwart the resolution process by raising claims that have not been submitted to and decided by the resolution professional would undermine the entire process and defeat the objective of the IBC."
"We have already seen how the IBC operates in rem, which is to say that it is binding on all stakeholders, including governmental authorities. This is because the ultimate aim of the IBC is to resolve the insolvency of the corporate debtor and to revive the corporate debtor by putting it back on its feet, free from past liabilities. The resolution plan, once approved, binds all stakeholders, including those governmental authorities who have claims that are not decided by the resolution professional, as these claims do not form part of the final resolution plan approved by the adjudicating authority. Such claims stand extinguished, and no further recourse is available to the claimants against the corporate debtor."
"It is also important to note that after a resolution plan is approved by the committee of creditors and before it is approved by the adjudicating authority, a certain category of creditors (such as operational creditors) may not receive a complete discharge of the amounts that are due to them. It is the duty of the committee of creditors to take care of the interests of all stakeholders, and to maximize the value of assets for the purpose of repaying the amounts due to them to the extent possible. The successful resolution applicant must start running the business of the corporate debtor on a fresh slate, free from past liabilities, so as to make it possible to revive the company and to keep it as a going concern."
"Once the resolution plan is approved by the adjudicating authority, all claims that are not a part of the resolution plan shall stand extinguished. No person will be entitled to initiate or continue any proceedings regarding a claim that is not part of the resolution plan. This extinguishment of claims includes those of the Central Government, any State Government or any local authority, as well as all other stakeholders, such as employees, members, creditors, and guarantors. The approval of the resolution plan and the consequent binding effect on all stakeholders, including the extinguishment of claims, ensure that the successful resolution applicant can take over the corporate debtor and begin running its business without any encumbrances or disruptions caused by past liabilities."
In another important case of Ghanashyam Mishra & Sons Pvt. Ltd. (through authorized signatory) v. Edelweiss Asset Reconstruction Company Ltd. (through the Director) & Ors. - 2021 SCC OnLine SC 313, it was held by the Hon'ble Supreme Court "that after the amendment of IBC on or after 16.8.2019, any debt in respect of the payment of dues arising under any law for the time being in force including the ones owed to the Central Government, any State Government or any local authority, which does not form a part of the approved resolution plan, shall stand extinguished."
"In order to remedy the said mischief, the legislature thought it appropriate to clarify the position that once such a resolution plan was approved by the adjudicating authority, all such claims/dues owed to the State/Central Government or any local authority including tax authorities, which were not part of the resolution plan shall stand extinguished."
"Thus, it is held that once a resolution plan is duly approved by the adjudicating authority under sub-section (1) of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the corporate debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the adjudicating authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan."
"Consequently all the dues including the statutory dues owed to the Central Government, any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the adjudicating authority grants its approval under Section 31 could be continued."
"The 2019 Amendment to Section 31 IBC is clarificatory and declaratory in nature and therefore will have a retrospective operation. As such, when the resolution plan is approved by NCLT, the claims, which are not part of the resolution plan, shall stand extinguished and the proceedings related thereto shall stand terminated. Since the subject-matter of the petition are the proceedings which relate to the claims of the respondents prior to the approval of the plan, the same cannot be continued. Equally the claims, which are not part of the resolution plan, shall stand extinguished."
In the case of Tata Power Western Odisha Distribution Ltd. (TPWODL) & Anr. v. Jagannath Sponge Pvt. Ltd. Director - Civil Appeal No. 5556/2023; the Hon'ble Supreme Court declined to entertain the claim of past arrears by the Electricity Supply Company and held "that Tata Power Western Odisha Distribution Limited cannot insist on payment of arrears, which have to be paid in terms of the waterfall mechanism, for grant of an electricity connection. The clean slate principle would stand negated if the successful resolution applicant is asked to pay the arrears payable by the corporate debtor for the grant of an electricity connection in her/his name. The dues of the corporate debtor have to be paid in the manner prescribed in the resolution plan, as approved by the adjudicating authority."
Same principle was stated in Southern Power Distribution Company of Andhra Pradesh Ltd. v. Gavi Siddeswara Steels (India) Pvt. Ltd. & Anr. - SC Civil Appeal No. 5716-5717/2023
In yet another case of Ruchi Soya Industries Ltd. & Ors. v. UOI & Ors. - (2022) 6 SCC 343, the Hon'ble Supreme Court reaffirmed it earlier view "that once a resolution plan is duty approved by the adjudicating authority under sub-section (1) of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the corporate debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the adjudicating authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan."
In another case of Arun Kumar Jagatramka v. Jindal Steel and Power Ltd. & Anr. - (2021) 7 SCC 474, the Hon'ble Supreme Court reiterated that "a resolution plan upon being approved becomes binding on all stakeholders and is attended with all benefits unlike Section 230 of the Companies Act, 2013."
"The approval of a resolution plan under Section 31 results in a "clean slate", as held in the judgment of this Court in Essar Steel (India) Ltd. (CoC) v. Satish Kumar Gupta 21. Rohinton F. Nariman, J. speaking for the three-Judge Bench of the Court, observed: (Essar Steel case, SCC p. 615, para 105)
"105. Section 31(1) of the Code makes it clear that once a resolution plan is approved by the Committee of Creditors it shall be binding on all stakeholders, including guarantors. This is for the reason that this provision ensures that the successful resolution applicant starts running the business of the corporate debtor on a fresh slate as it were. In SBI v. V. Ramakrishnan, this Court relying upon Section 31 of the Code has held: (SCC p. 411, para 25)
'25. Section 31 of the Act was also strongly relied upon by the respondents. This section only states that once a resolution plan, as approved by the Committee of Creditors, takes effect, it shall be binding on the corporate debtor as well as the guarantor. This is for the reason that otherwise, under Section 133 of the Contract Act, 1872, any change made to the debt owed by the corporate debtor, without the surety's consent, would relieve the guarantor from payment. Section 31(1), in fact, makes it clear that the guarantor cannot escape payment as the resolution plan, which has been approved, may well include provisions as to payments to be made by such guarantor. This is perhaps the reason that Annexure VI(e) to Form 6 contained in the Rules and Regulation 36(2) referred to above, require information as to personal guarantees that have been given in relation to the debts of the corporate debtor. Far from supporting the stand of the respondents, it is clear that in point of fact, Section 31 is one more factor in favour of a personal guarantor having to pay for debts due without any moratorium applying to save him." (emphasis supplied)
"The benefit under Section 31, following upon the approval of the resolution plan, is that the successful resolution applicant starts running the business of the corporate debtor on "a fresh slate".
In line with the above dicta of the Hon'ble Supreme Court of India in various cases, the High Courts and Appellate Authority (NCLAT), New Delhi also made observations following the clean slate theory, some of which cases and their observations are as under:
i. Indian Oil Corporation Ltd. v. Arcelor Mittal Nippon Steel India Ltd. - 2023 SCC OnLine Del 6318 - Delhi High Court
ii. JSW Steel Ltd. v. Ashok Kumar Gulla & Ors. - 2019 SCC OnLine NCLAT 854 - NCLAT
iii. Shapporji Pallonji and Co. Pvt. Ltd v. Kobra West Power Company Limited & Ors. - 2023 SCC OnLine NCLAT 968 - NCLAT Delhi
iv. Regional Provident Commissioner Employees Provident Fund Organisation v. Vandana Garg & Anr. - 2021 SCC OnLine NCLAT 146 - NCLAT Chennai
v. Commissioner of Customs & Excise - Jaipur-I v. Ashika Commercial Pvt. Ltd. (through the RP Rajesh Kumar Agarwal) & Ors. - 2022 SCC OnLine NCLAT 1939 - NCLAT Delhi
vi. Ashvinkumar Jayantilal Patel V. Shri Sanjay Jitendralal Shah & Ors. - 2023 SCC OnLine NCLAT 1085 - NCLAT Delhi
"However, once the aforesaid process has been completed and the resolution plan comes to be approved, no fresh claims can be laid or enforced against the successful resolution applicant. The successful resolution applicant is only bound to meet the claims as may have been accepted and ultimately form part of the approved resolution plan. This issue assumes seminal importance since the successful resolution applicant cannot be left open to defend or oppose claims which are either not factored in the resolution plan nor can it be left to fend off actions that may be brought with respect to alleged or asserted dues of the corporate debtor which were not admitted. Taking any other position would clearly violate the clean and fresh slate doctrines which inform and imbue the resolution process under the IBC. The Supreme Court while alluding to the intent of the resolution process underlying the IBC had described this aspect as the "hydra-headed monster". In fact, Ghanashyam Mishra case significantly observes that all claims which are not part of the resolution plan shall stand extinguished and no person would be entitled to "initiate or continue" any proceedings in respect of the claim."
"From the decision of the Hon'ble Supreme Court in "Committee of Creditors of Essar Steel India Limited Through Authorised Signatory" (Supra), it is clear that a successful resolution applicant cannot suddenly be faced with "undecided" claims after the resolution plan submitted by him has been accepted as this would amount to a hydra head popping up which would throw into uncertainty amounts payable by a prospective resolution applicant who successfully take over the business of the corporate debtor. All claims must be submitted to and decided by the resolution professional so that a prospective resolution applicant knows exactly what has to be paid in order that it may then take over and run the business of the corporate debtor. This the successful resolution applicant does on a fresh slate, as has been pointed out by the Hon'ble Supreme Court."
"In this factual matrix, the main point which arises for consideration in this Appeal is whether the Appellant/'Operational Creditor' can be allowed to pursue the Arbitration Proceedings in the light of the ratio laid down by the Hon'ble Apex Court in 'Fourth Dimension Solutions' (Supra). It is the case of the Learned Sr. Counsel Mr. P. Nagesh appearing for the SRA that once the Resolution Plan is approved as per the precedents laid down by the Hon'ble Apex Court in 'Ghanshyam Mishra and Sons Private Limited' (Supra), 'K. Shashidhar' Vs. 'Indian Overseas Bank & Anr.' 'Maharashtra Seamless Ltd.' Vs. 'Padamanabhan Venkatesh & Ors.' and in 'Kalpraj Dharamshi & Anr.' Vs. 'Kotak Investment Advisors Ltd. & Anr., that any 'Claims' which are not part of the Resolution Plan shall stand extinguished and no person would be entitled to continue any Proceedings in respect of a 'Claim', which is not part of Resolution Plan."
"After approval of the Resolution Plan by the Adjudicating Authority, all such claims that are not part of the Resolution Plan shall stand extinguished. No person is entitled to initiate or continue any proceeding regarding a claim that is not part of the Resolution Plan."
"All the dues including the statutory dues owed to the Central Government, any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating Authority grants its approval under Section 31 could be continued."
"It shows that the claims of the creditors which are not part of the Resolution Plan get extinguished upon approval of the Resolution Plan. In this Resolution Plan, the claims of the Directors of the Corporate Debtor are not considered by the RP as they being related parties of the Corporate Debtor. However, at the same time, the CoC in their commercial wisdom allowed the claim of those directors of the Corporate Debtor to be carried forward against the provisions of law and overlooking the judgement of the Supreme Court as stated above, At the same time, the claims of the Operational Creditors are extinguished completely."
Conclusion:
From the aforesaid decisions and settled law, it is certain that any person can acquire a debt free company in any territorial jurisdiction and of any sector in India, subject to availability of a corporate debtor, in CIRP or Liquidation, under the provisions of the IBC. The corporate debtor, shall be a going concern with all liabilities and obligations, legal or otherwise, in terms of approved resolution plan, with other attendant benefits.
In fact, even during liquidation, the Adjudicating Authority, may in its discretion, direct that acquisition of the corporate debtor as a going concern shall be transferred without any contingent liabilities as held in Shiv Shakti Interglobe Exports vs. KTC Foods (P); Company Appeal (AT) (Insolvency) No. 650 of 2020 NCLAT.
It was held in the case of sale of assets in liquidation proceedings also, "that it is a settled law that when the sale proceeds of a 'Corporate Debtor' are duly distributed in the order of priority and in the manner prescribed under Section 53 of the Code, claims of any other Creditor cannot be entertained contrary to the provisions entailed under Section 53; subsequent to the distribution of sale proceeds under Section 53, no other entity including any Government entity can claim any past unpaid or outstanding dues against the Appellant who has purchased the 'Corporate Debtor Company' as a 'going concern'. It is significant to mention that the second Respondent/Liquidator has specifically submitted that even these claims by the Uttar Haryana Bijili Vitran Nigam were not submitted in the prescribed form either during the CIRP Process or at the Liquidation stage. We are of the considered view that at this stage subsequent to the sale of the 'Corporate Debtor Company' as a 'going concern', these claims cannot be foisted upon the Appellant. The scope and objective of the Code is to extinguish all claims specifically the ones which were not even made during the CIRP or in the Liquidation stage, to aid the purchaser of the Company as a 'going concern' to start on a 'clean slate'. The Hon'ble Supreme Court in 'Ghanshyam Mishra & Sons v. Edelweiss Asset Reconstruction Company Ltd.', Civil Appeal No. 8129 of 2019 and in 'CoC of Essar Steel India Ltd. v. Satish Gupta' (2020) 8 SCC 531 has laid down the proposition that the purchaser of the Company even in the Liquidation stage cannot be burdened with past liabilities when it is not mentioned in the 'Sale Notice'."
"It is no longer Res Integra that while approving a 'Corporate Debtor' sale as a 'going concern' in Liquidation Proceedings without its dissolution in terms of Regulation 32(e) of the Liquidation Process Regulations, 2016, it is essential to see that the 'Corporate Debtor' is not burdened by any past or remaining unpaid outstanding liabilities prior to the sale of the Company as a 'going concern' and after payment of the sale proceeds distributed in accordance with Section 53 of the Code. The sale of the company (corporate debtor) as a going concern was approved and direction for extinguishment of past/ remaining unpaid outstanding liabilities including contingent liabilities, prior to the sale as a 'going concern', after payment of sale proceeds distributed in accordance with Section 53 of the Code, is allowed."
It is thus settled now and is beyond doubt that a corporate debtor may be acquired, as a going concern with readily available employees, workers, plant & machinery, land and building and other tangible and intangible assets and properties, including intellectual property rights as vested in the corporate debtor. In terms of the approved resolution plan, the equity capital of the corporate debtor may be restructured or extinguished and the acquirer takes over the undertaking with all assets as mentioned hereinabove with attendant licenses, entitlements and rights with all liabilities fully and completely extinguished, save and except as provided in the approved resolution plan.
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