# In the matter of Clutch Auto Limited (IB)-15-(PB)-2017

> NCLT judgment dated 2018-02-15. Citation: TCN-2018-NCLT-01822. The case involves corporate insolvency resolution process (CIRP) initiated against Clutch Auto…

- **Court:** NCLT
- **Order date:** 15 Feb 2018
- **Citation:** TCN-2018-NCLT-01822
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/clutch-auto-limited-ib-15-pb-2017-04248c1b

## Summary

### Background

The case involves corporate insolvency resolution process (CIRP) initiated against Clutch Auto Limited. The CIRP was triggered by an application filed by the Corporate Debtor itself under Section 10 of the Insolvency and Bankruptcy Code, 2016. An Interim Resolution Professional was initially appointed, later replaced by Mr. Sandeep Kumar Gupta. The Committee of Creditors (CoC) was formed and approved by the Adjudicating Authority (NCLT). Two valuers were initially appointed to assess the liquidation value of the Corporate Debtor's assets, resulting in significantly different valuations. A third valuer was then appointed. The Resolution Applicant, Prometrik Engineering Limited, submitted a resolution plan which was ultimately rejected by the CoC.

## Facts

Clutch Auto Limited initiated CIRP under Section 10 of the IBC. The Tribunal admitted the case on 2017-04-10. An Interim Resolution Professional was appointed but later replaced by Sandeep Kumar Gupta. The liquidation value of the Corporate Debtor's assets was assessed by multiple valuers, with varying results (Rs. 48 crores, Rs. 74 crores, and Rs. 44.24 crores). The total debt owed by the Corporate Debtor was approximately Rs. 477 crores. Prometrik Engineering Limited submitted a resolution plan with three proposals, including taking over the business with or without land in Bhiwadi and Faridabad. The CoC advised Prometrik to revise its offer. Prometrik increased the offer, subject to conditions regarding the Faridabad land being free from encumbrances. The CoC

…

## Issues and analysis

### Issue 1: Whether the resolution plan submitted by …

**Ratio:** The commercial wisdom of the Committee of Creditors (CoC) in accepting or rejecting a

…

**Reasoning:** The CoC rejected the resolution plan due to concerns about its viability, specifically

…

**Interpretation:** The Insolvency and Bankruptcy Code emphasizes the importance of adhering to

…

**Application:** The CoC's decision to reject Prometrik's resolution plan was based on valid

…

## Parties

- **Judges:** M. M. K…; S. K. MOH…
- **Respondents:** Clutch Auto…
- **Advocates:** Krishnendu…; Ashu Ka…; +7 more

## Timeline

- **2017-04-10 — Admission o…**: The Tribunal admitted the case filed by the…
- **2017-06-28 — Appointment of…**: Sandeep Kumar Gupta was appointed…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 10 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-10)

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