NCLT says failed Resolution Plan Can Lead to Liquidation but Unexamined Fraudulent Transactions Must Still Be Pursued

Mangalagiri Textiles' CIRP ran through multiple extensions and ultimately produced one compliant resolution plan, submitted by its suspended director. 

Although the CoC approved the plan, the Resolution Applicant repeatedly failed to furnish the required Performance Bank Guarantee, rendering the plan non-responsive. 

The CoC therefore resolved to liquidate the Corporate Debtor. NCLT approved liquidation, but separately noted that the Transaction Auditor had identified probable fraudulent transactions and directed the Liquidator to examine it.