I am not aware of this expression! What is the context for the phrase?
I have seen that expression very common in colleges(in my country). when one fails to pass a paper in college then it will be called as arrear. As soon as the results are out, we, friends, just ask each other; "all clear?" to mean have you cleared all the papers?. Oh! no man, I have two arrears(backlogs).
I haven't seen this expression used in schools. We just ask "have you passed the paper?"