# In the matter of Aarohi Motors Pvt. Ltd. C.P. (I.B) No. 117-10-NCLT-AHM-2017

> NCLT judgment dated 2018-03-19. Citation: TCN-2018-NCLT-01683. The case involves an application filed by the resolution professional seeking liquidation of…

- **Court:** NCLT
- **Order date:** 19 Mar 2018
- **Citation:** TCN-2018-NCLT-01683
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/aarohi-motors-pvt-ltd-cp-ib-no-117-10-nclt-ahm-2017-d70b454b

## Summary

### Background

The case involves an application filed by the resolution professional seeking liquidation of the corporate debtor company, Aarohi Motors Pvt Ltd, under Section 33(2) of the IB Code. The corporate applicant, Aarohi Motors Pvt Ltd, had previously filed a petition under Section 10 of the Code, which was admitted, triggering the CIRP. An IRP was appointed, who constituted the COC. However, the COC, in its sixth meeting held on 2018-02-26, resolved that no resolution plan received from Rare Asset Reconstruction Pvt Ltd met the criteria and rejected it. Consequently, the COC decided to proceed with the liquidation of the Corporate Debtor company.

## Facts

Aarohi Motors Pvt Ltd (Corporate Debtor) filed a petition under Section 10 of the Insolvency and Bankruptcy Code (IBC), which was admitted, initiating the Corporate Insolvency Resolution Process (CIRP). An Interim Resolution Professional (IRP) was appointed, who then constituted the Committee of Creditors (COC). During the CIRP, the COC received a resolution plan from Rare Asset Reconstruction Pvt Ltd. However, in its sixth meeting held on 2018-02-26, the COC unanimously resolved that the resolution plan did not meet the required criteria and was therefore rejected. Consequently, the COC decided to proceed with the liquidation of Aarohi Motors Pvt Ltd under Section 33 of the IBC. The resolution professional, Mr. Dipak Rachchha, was to continue as the liquidator. The

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## Issues and analysis

### Issue 1: Whether the COC's decision to reject the resolution …

**Ratio:** The COC has the authority to evaluate resolution plans and decide whether they meet the

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**Reasoning:** The COC unanimously resolved that the resolution plan received from Rare Asset

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**Interpretation:** Section 33 of the IB Code allows for liquidation when no resolution plan is

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**Application:** In this case, the COC's decision to reject the resolution plan was based on its

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## Parties

- **Judges:** Harihar Prakash…; Manorama…
- **Respondents:** Aarohi Motors Pvt…; Bank of…

## Timeline

- **2018-02-26 — COC Meet…**: The COC held its sixth meeting and resolved that no resolution plan received from Rare…
- **2018-03-19 — Order Da…**: The adjudicating authority ordered the liquidation of the Corporate Debtor company,…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33 — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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