The National Company Law Tribunal (NCLT) has ordered winding up of Hero Electric Vehicles Pvt. Ltd failed to develop an approved plan following attempts to revive the company through the insolvency resolution process. The order was passed by the New Delhi Bench of NCLT on March 3, 2026.The Tribunal noted that none of the resolution proposals received the required co-operation from the creditors within the timeline set out below. Insolvency and Bankruptcy Code (IBC). As a result, the provisions relating to liquidation under the Code were triggered.Bankruptcy proceedings against Hero Electric began after Metro Tires Limited filed an application under the IBC. Following the application, the Tribunal admitted the case and initiated the Corporate Insolvency Resolution Process (CIRP) on 20 December 2024. After the process begins, the resolution professional invites claims from creditors and forms a Committee of Creditors (CoC) to oversee the resolution process. The committee included several financial institutions such as Bank of Baroda, South Indian Bank, IDFC First Bank and Kotak Mahindra Bank.
During the bankruptcy process, the committee held several meetings to review proposals from companies interested in taking over the business. Expressions of interest were invited from potential investors and several parties initially expressed interest in acquiring the company. Ultimately, two draft resolutions were formally presented for consideration.However, when these proposals were put to a vote by the Committee of Creditors, none of them managed to get the minimum approval required under the IBC framework. By law, a resolution plan must receive at least 66 percent voting from creditors to be approved. The proposal with the most support managed to get 47.66 percent of the vote, short of the required threshold.The tribunal observed that the creditors remained divided on the future course of action. While about half of the creditors supported the resolution plan, the remaining members favored liquidation. Even after further discussions and revisions, the committee could not reach a consensus.Given the impasse and the expiry of the insolvency resolution timeline, the Tribunal concluded that continuing the process would serve no purpose under the IBC framework. Under section 33(1)(a) of the Insolvency and Bankruptcy Code, a winding-up order can be made if a resolution plan is not approved before the expiry of the period of insolvency proceedings.
