NCLAT upholds liquidation of Worlds Window Exim and rejection of Rs 7 crore plan

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, on 12 October 2026 upheld an order of the National Company Law Tribunal (NCLT), New Delhi, dated 14 August 2026 that rejected a resolution plan for Worlds Window Exim Private Limited, ordered the company's liquidation and directed an investigation into its affairs. The plan, offering Rs 7 crore, was submitted by Dickey Special Situation Investment Trust-DSSF Series 2 and approved by the lenders.

What Happened

Per the order, the company was set up to hold land in Ghaziabad district for its group and had no operations. Central Bank of India's application led to its admission into insolvency on 16 May 2025. During the process, the debts of Bank of India, Bank of Baroda and Central Bank of India were assigned to Prudent ARC Limited, an asset reconstruction company, which then held 94.86% of the votes on the creditors' committee. Valuers put the liquidation value at Rs 9,42,25,758.

The NCLAT agreed with the appellants that a plan below liquidation value is not illegal by itself. But it held that the plan did not show how it addressed the cause of the company's default, as Regulation 38(3)(a) of the CIRP Regulations requires, and so failed Section 30(2) of the Insolvency and Bankruptcy Code. It also said the overall circumstances, including the assignment of public-sector bank debt during the process and the low offer, supported the NCLT's doubts about the plan, while making clear it did not rest its decision on suspicion alone.

The NCLAT upheld the direction that the liquidator inquire into the company's affairs and file applications under Sections 43, 45, 50 and 66 of the Code if needed, and said the persons concerned will be heard before any order. It set aside, as premature, the NCLT's direction limiting the ARC's share to what it paid Central Bank of India, keeping that question open.

What It Means

The ruling shows that the lenders' approval does not save a plan that misses a mandatory requirement, and that the tribunal is not bound in every case to give lenders a chance to fix defects before ordering liquidation. The NCLAT's order may be appealed to the Supreme Court.

Source: NCLAT order