Yes Bank Limited vs M/s Chadha Super Cars Private Limited

Per: SH. KHETRABASI BISWAL, MEMBER (JUDICIAL)

The present Application has been filed by Mr. Bhupinder Sethi, the Resolution Professional in respect of M/s Chadha Super Cars Private Ltd (hereinafter referred to as the “Corporate Debtor/CD”) under section 33 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “IBC” or “Code”) by, inter-alia, seeking to initiate liquidation proceedings by appointing the Resolution Professional namely Sh. Bhupinder Sethi as the Liquidator etc .

Brief facts, as stated by the Applicant in the Application, leading to the filing of instant Application, are as below:

i. Initially, Yes Bank Ltd (financial Creditor) has filed main Petition under Section 7 read with Rule 4 of the Code, which was admitted by this Tribunal, vide, Order dated 08.01.2024 by initiating CIRP against the CD by, inter-alia, appointing the Applicant as IRP. ii. Accordingly, the Applicant, being the IRP, had published the Form A and invited claims in the matter of the present corporate debtor, and after the receipt of the claims the IRP constituted the Committee of Creditors comprising of ICICI Bank Limited having 93.76% voting share, and Yes Bank Limited having voting share Of 6.24%. The IRP, then held the 1st meeting of the CoC on 07.02.2024, where amongst various other agendas the agenda for appointment of RP was also placed before the CoC and voted accordingly and Mr. Bhupinder Sethi was appointed as the Resolution Professional. Thereafter, the Applicant held 2nd meeting of the CoC on 06.03.2024 and had re-constituted a committee of creditors on 04.03.2024 after the verification of claim of PPG Asian Paints Private Limited as its Member. The updated CoC accordingly constituted ICICI Bank Limited having 87.68% voting share, Yes Bank Limited having voting share of 5.83% and PPG Asian Paints Private Limited having voting share of 6.48%. The agenda for appointment of six independent valuers two each for valuation of Land and Building Plant and Machinery, and Security and Financial Assets of the Corporate debtor were also approved. The CoC also took note of the Information Memorandum and had approved the Eligibility Criteria for prospective resolution applicants (PRA's) and Evaluation Matrix, EMD.

The RP had issued the Form G in the above-mentioned matter on 21.03.24 and the same was published in 2 newspapers, one English i.e. "The Tribune" and one Punjabi i.e. "Punjabi Tribunal". As per Form G, the last date for receipt of the Expression of Interest (EOI) was 05.04.2024 and last date for receipt of resolution plans was 07.06.2024. And thereafter, the RP held the 3rd meeting of the COC on 05.04.2024 where RP updated CoC that a non-cooperation application against suspended directors and Statutory Auditors has been filed as they have not fully cooperated & provided all relevant information till the CIRP date. Subsequently, 4th meeting of the COC was held on 04.05.2024, where the RP had appraised the COC that after publication of the Form G, Expression of Interest (EOI) was received from 1 PRA's but no resolution plan was submitted by them and also appraised the appointment of Transaction Auditor and Jasminder Singh & Associates were appointed.

The RP, thereafter held the 5th meeting of the CoC on 05.06.2024. The agenda for extension of the CIRP process was deferred by the COC in the present meeting. Then, the 6th COC meeting was conducted on 24.06.2024 where the Resolution Professional had appraised that no resolution plan was submitted by the only prospective resolution Applicant. The agenda for extension of the CIRP process was deferred by the COC in the present meeting. The Resolution Professional also discussed re-publication of Form- G which was, however, declined by the CoC members. The Agenda for Liquidation of the corporate debtor was also put forth in the present meeting which was approved by the CoC with 87.68% voting share and the CoC had resolved and authorized the RP to file an application for liquidation of the corporate debtor, while appointing the applicant RP as the Liquidator.

The RP, amongst other agendas, had also placed the agenda for compliance of Regulation 39B, 39C and 39D of the CIRP regulations, before the CoC in their 6th meeting. However, the CoC rejected the agenda relating to the estimated liquidation cost at Rs.33,20,000/-, in view of the provision of regulation 39B of the CIRP regulations, the COC had also not resolved and approved the remuneration of the liquidator to be as per regulation 4(a) & (b) of the Liquidation regulations and hence the agenda under regulation 39D of the CIRP regulations, was not approved. The COC, had however rejected the agenda for sale of the corporate debtor as going concern u/r 39C of the CIRP regulations. In view of the same the agendas with respect to regulations 39B,39C & 39D of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 have been provided for in the matter of the present corporate debtor.

The Applicant has filed his consent in prescribed form to act as liquidator along with the AFA and IBBI Certificate is attached with the Application. He has also filed an Affidavit dated 08.10.2025 containing the audited balance sheet of the corporate debtor for period ending 08.01.2024 i.e. CIRP commencement date which is appended with the Affidavit.

We have heard Mr. Pulkit Goyal, Advocate along with Mr. Bhupinder in person on line and also perused the record carefully along with extant provisions of Code and the Rules made thereunder.

The learned Counsel has once again reiterated various averments made in the Application and asserted that he has followed all extant provisions of the Code for the filing of this Application and thus urged the Tribunal to allow the Application as prayed for.

As stated supra, the competent CoC has correctly analyzed the issue and thus decided to put the CD under liquidation process. When there is no viable and effective Resolution plan is forthcoming, continuing the CIRP process for a longer period than necessary, would only result in exorbitant CIRP costs without any purpose. And the Resolution to initiate Liquidation process was passed with requisite majority prescribed under law ( ie 87.68% voting share). The Applicant is eligible to be appointed as Liquidator, who has filed his consent as stated supra. On the last date of hearing on 25.11.2025, the RP gave his consent to act as a liquidator and the Tribunal directed the RP to file the renewed AFA. In compliance with the same, Renewed and valid AFA of the Resolution Professional was filed with the Affidavit dated 28.11.2025.

It is also a settled position of law that the Adjudicating Authority can hardly interfere in the commercial wisdom of Competent COC, as long as its decisions are supported with reasons and are made in accordance with settled position of law. Therefore, there is no reason to differ with the decision of COC to put the CD under liquidation process and the Application deserves to be allowed with suitable consequential directions.

In the result, the instant Application bearing IA(IBC) (LIQ.) 16/2024 is hereby allowed by the appointing the Applicant namely Mr. Bhupinder Sethi, with IBBI Reg. No. IBBI/IPA-001/IP-P-02144/2020-2021/13366, with email id of the Liquidator is [email protected] and the contact no.9779194490 as Liquidator to liquidate CD namely M/s Chadha Super Cars Private Limited with following consequential directions:

i. The Applicant is directed to follow Liquidation process as envisaged under Chapter-III of the Code and the Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016 and follow all extant provisions of code and the rules made thereunder so that the authorities concerned are informed of the Liquidation order timely.

ii. The Liquidator will charge fees for the conduct of the liquidation proceedings in proportion to the value of the Liquidation estate assets as specified by the IBBI and the same shall be paid to the Liquidator from the proceeds of the Liquidation estate under Section 53 of the Code.

The liquidator is directed to make a public announcement u/s 33(1)(b)(ii) of the Code, clearly stating that the Corporate Debtor is under Liquidation in terms of Regulation 12 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016. iv. All the powers of the Board of Directors, and key managerial personnel, shall cease to exist in accordance with Section 34(2) of the Code. All these powers shall henceforth vest in the Liquidator.

The personnel of the Corporate Debtor are directed to extend all assistance and cooperation to the Liquidator as required by him in managing the Liquidation process of the Corporate Debtor. vi. The Order of Moratorium passed under Section 14 of the Code shall cease to have effect and a fresh Moratorium as per provisions of Section 33(5) of the Code and its proviso, shall commence. vii. The Liquidator shall follow up and continue to manage the financial affairs of the Corporate Debtor in accordance with provisions of Section 35(1) of the Code. viii. The Liquidator shall also follow up on the pending applications during the process of Liquidation, including initiation of steps for recovery of dues of the Corporate Debtor, as per law. ix. The Liquidator shall submit a Preliminary Report to the Adjudicating Authority within seventy-five days from the Liquidation commencement date as per Regulation 13 of the Insolvency and Bankruptcy (Liquidation Process) Regulations, 2016.

The Liquidator will also serve a copy of this Order to the various Government Departments such as Income Tax, GST, VAT, etc., who may have any claim upon the Corporate Debtor so that the authorities concerned are informed of the Liquidation order timely.

The Registry is directed to furnish a copy of this Order to the Applicant, the concerned ROC and IBBI.

The Applicant is directed to apprise the Adjudicating Authority from time to time about the actions to be taken in pursuance with this Order.

Accordingly, IA (IBC)(LIQ.) 16(CH)/2024 stands allowed and disposed of.