# In the matter of Abdos Polymers Limited vs. Callina Care Overseas Pvt. Ltd. Company Appeal (AT) (Insolvency) No. 788 of 2021

> NCLAT judgment dated 2023-03-20. Citation: TCN-2023-NCLAT-00666. The appeal was filed against the order dated 05.07.2021 passed by the Adjudicating Authority…

- **Court:** NCLAT
- **Order date:** 20 Mar 2023
- **Citation:** TCN-2023-NCLAT-00666
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/abdos-polymers-limited-vs-callina-care-overseas-pvt-ltd-company-appeal-27459e0e

## Summary

### Background

The appeal was filed against the order dated 05.07.2021 passed by the Adjudicating Authority (National Company Law Tribunal, Court No. IV, New Delhi) in Company Petition No. IB-1294/ND/2018, which dismissed the application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC). The Appellant, an operational creditor, filed the application to initiate the Corporate Insolvency Resolution Process (CIRP) against the Respondent, Callina Care Overseas Pvt. Ltd., alleging that there was a default in payment of dues. The Adjudicating Authority dismissed the application on the ground that there were disputes existing between the parties prior to the issuance of the Demand Notice.

## Facts

Abdos Polymers Limited (Appellant/Operational Creditor) filed an application under Section 9 of the IBC to initiate CIRP against Callina Care Overseas Pvt. Ltd. (Respondent/Corporate Debtor) for a default in payment of Rs. 10,96,184/-. The Appellant claimed that it supplied goods (P.P. Sacks) to the Respondent between November 2015 and December 2015, and the debt fell due on 1st February 2016. The Appellant served a Demand Notice dated 01st November 2017 upon the Respondent under Section 8 of the IBC, claiming Rs. 14,18,462/-. The Adjudicating Authority dismissed the application, holding that there were disputes existing between the parties prior to the issuance of the Demand Notice. The Respondent contended that the goods supplied were defective and there was a delay

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority was correct in dismissing the application under Section 9 of the …

**Ratio:** The existence of a pre-existing dispute is a valid ground for rejecting an application

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**Reasoning:** The NCLAT relied on the judgment of the Supreme Court in Mobilox Innovation Pvt. Ltd. Vs.

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**Interpretation:** The term 'dispute' under Section 9 of the IBC does not mean mere pendency of

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**Application:** In this case, the Respondent had raised concerns regarding the quality and

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## Parties

- **Judges:** Anant Bijay…; Kanthi Na…; +1 more
- **Appellants:** Abdos Polymers…
- **Respondents:** Callina Care…
- **Advocates:** Kanwal Cha…; Smitakshi T…; +1 more

## Timeline

- **2015-11-19 — Invoices…**: Appellant raised invoices upon Respondent Company from 19th November, 2015 to 29th…
- **2016-02-01 — Debt Fel…**: Debt of Rs. 10,96,184/- fell…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 8 — Insolvency resolution by operational creditor](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-8)

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