If Secured Creditor does not sell secured asset, Liquidator can ask to return back the assets to the liquidation estate – Dhanlaxmi Bank Ltd. Vs. Techno Fab Manufacturing Ltd. & Ors. – NCLAT New Delhi
The order of liquidation was passed on 05.09.2018 and the physical possession of the secured asset was handed over to the Appellant by the liquidator on 03.09.2019. The first auction of the secured asset was made on 03.09.2019 and second on 06.01.2021. The Liquidator has asked the Appellant to vacate its physical possession and to return back asset to the liquidation estate.
NCLAT upheld the decision of the adjudicating authority and held that in the present case, three years has been lapsed and the liquidation proceeding could not be completed and after granting ample opportunity the Appellant has failed to realize its security interest. Therefore, Ld. Adjudicating Authority has rightly directed the Appellant to handover the asset in possession back to the liquidator within 7 days.
