# In the matter of Ajit Automotive Services Private Limited IA No. 01-ND-2021 In  Company Petition No. (IB)-1525(ND)-2019

> NCLT judgment dated 2021-06-15. Citation: TCN-2021-NCLT-01970. The case involves an application filed by the Resolution Professional (RP) under Section 33(1)…

- **Court:** NCLT
- **Order date:** 15 Jun 2021
- **Citation:** TCN-2021-NCLT-01970
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ajit-automotive-services-private-limited-ia-no-01-nd-2021-in-company-petition-no-875149ee

## Summary

### Background

The case involves an application filed by the Resolution Professional (RP) under Section 33(1) of the Insolvency and Bankruptcy Code (IBC), 2016, seeking directions for the liquidation of the corporate debtor, Ajit Automotive Service Private Limited. An operational creditor, M/S Dynamic Security, had previously filed an application under Section 9 of the IBC for initiating the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor, which was admitted on 19.08.2019. Mr. Mohinder Singh was appointed as the Interim Resolution Professional (IRP). Subsequently, the CoC decided to replace the IRP with Mr. Rohit Sehgal as the RP.

## Facts

M/S Dynamic Security, an operational creditor, initiated Corporate Insolvency Resolution Process (CIRP) against Ajit Automotive Service Private Limited under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016. The application was admitted on 19.08.2019, and Mr. Mohinder Singh was appointed as the Interim Resolution Professional (IRP). Subsequently, Mr. Rohit Sehgal replaced Mr. Mohinder Singh as the Resolution Professional (RP). Despite two rounds of inviting Expression of Interest, no prospective resolution applicant showed interest. The Committee of Creditors (CoC) deliberated and decided to liquidate the corporate debtor due to the absence of any resolution plan. The CoC passed resolutions for liquidation and for the sale of the corporate debtor as a going

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## Issues and analysis

### Issue 1: Whether the corporate debtor, Ajit Automotive Service Private Limited, should be liquidated under …

**Ratio:** Section 33(1) of the Insolvency and Bankruptcy Code, 2016, provides that where the

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**Reasoning:** The court reasoned that since no resolution plan was received despite efforts to invite

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**Interpretation:** Section 33(1) is interpreted to mean that liquidation is the default outcome

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**Application:** In this case, the absence of any resolution plan, despite multiple attempts,

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## Parties

- **Judges:** DEEPTI M…; SUMITAPURKA…
- **Appellants:** Rohit S…
- **Respondents:** Ajit automotive…; Mr.BhavinderSinghK…

## Timeline

- **2019-08-19 — CIRP Init…**: Application under Section 9 of the IBC filed by M/S Dynamic Security was admitted,…
- **2019-09-18 — RP Appoin…**: The CoC decided to replace the IRP with Mr. Rohit Sehgal as the Resolution Professional…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33(1) — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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