Regulation 47 of Liquidation Process deals with only model timelines which are directory and not mandatory, extension of time under Liquidation can be allowed in exceptional circumstances – Prakash Chandra Kapoor Vs. Vijay Kumar Iyer, (Liquidator) – NCLAT New Delhi
NCLAT held that it just & expedient to exercise our inherent powers under Rule 11 of the NCLAT Rules, 2016 to extend the period by six weeks to enable the Liquidator to attempt the Sale as a Going Concern. The timelines under Regulation 47 for Liquidation Process, are directory. Procedural law should not be construed as an obstruction but as an aid to Justice. Extension of time under Liquidation may be allowed only on the satisfaction that there exists exceptional circumstances. What is mandated in the Code in Section 35(1)(e) is to ‘carry on business’ for its ‘beneficial Liquidation’. The Regulation therefore cannot override the objective of ‘beneficial liquidation’ provided for in Section 35(1)(e) of the Code.