# In the matter of Cheema Paper Mills Private Limited

> NCLT judgment dated 2025-05-08. Citation: TCN-2025-NCLT-00099. The case pertains to the initiation of liquidation proceedings against Cheema Paper Mills…

- **Court:** NCLT
- **Order date:** 8 May 2025
- **Citation:** TCN-2025-NCLT-00099
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/cheema-paper-mills-private-limited-8ed02241

## Summary

### Background

The case pertains to the initiation of liquidation proceedings against Cheema Paper Mills Private Limited under Section 33(2) of the Insolvency and Bankruptcy Code, 2016. IDBI Bank Limited, the Financial Creditor, had initially filed an application under Section 7 of the Code to initiate the Corporate Insolvency Resolution Process (CIRP) against Cheema Paper Mills. The application was admitted by the Adjudicating Authority on 2024-05-14, and a moratorium was declared, appointing Mr. Nipan Bansal as the Interim Resolution Professional. Subsequently, the Committee of Creditors (CoC) decided to liquidate the Corporate Debtor with 100% voting share in favor of liquidation.

## Facts

IDBI Bank Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Cheema Paper Mills Private Limited. The Adjudicating Authority admitted the application on 2024-05-14 and appointed Mr. Nipan Bansal as the Interim Resolution Professional. The Committee of Creditors (CoC) in its 2nd meeting held on 2024-07-09, with 100% voting share, decided to liquidate the Corporate Debtor. The Resolution Professional then filed an application seeking liquidation under Section 33(2) of the Code. The CoC had also resolved to appoint Mr. Nipan Bansal as the Liquidator. However, IBBI had issued a circular recommending that a person other than the IRP/RP should be appointed as the

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## Issues and analysis

### Issue 1: Whether the Resolution Professional, with the approval of CoC with 100% vote share, can directly …

**Ratio:** The CoC is competent and empowered to take a decision regarding the liquidation of the

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**Reasoning:** The court relied on the NCLAT's interpretation of Section 33(2) of the Code and the

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**Interpretation:** Section 33(2) of the Code, along with its explanation, grants the CoC the

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**Application:** In this case, the CoC, with a 100% voting share, decided to liquidate Cheema

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## Parties

- **Judges:** Sh. Harnam Singh…; Sh. Shishir…
- **Appellants:** IDBI Bank L…
- **Respondents:** Cheema Paper…

## Timeline

- **2023-07-18 — IBBI Notifi…**: IBBI issued Notification No. Liq-12011/214/2023-IBBI/840 recommending appointment of…
- **2024-05-14 — Admission…**: Adjudicating Authority admitted the application filed by IDBI Bank Limited and declared a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33(2) — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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