# In the matter of Basant Kumar vs. SVS Cleanroom and Engineering System OPC Pvt. Ltd. & Anr. Comp. App (AT) (Ins) No. 381 of 2021

> NCLAT judgment dated 2023-01-12. Citation: TCN-2023-NCLAT-00777. The appeal was filed under Section 61 of the Insolvency and Bankruptcy Code, 2016, against an…

- **Court:** NCLAT
- **Order date:** 12 Jan 2023
- **Citation:** TCN-2023-NCLAT-00777
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/basant-kumar-vs-svs-cleanroom-and-engineering-system-opc-pvt-ltd-anr-comp-app-3bc2e91a

## Summary

### Background

The appeal was filed under Section 61 of the Insolvency and Bankruptcy Code, 2016, against an order dated April 9, 2021, passed by the National Company Law Tribunal, New Delhi, in CP(IB) No. 1051/ND/2020. The Adjudicating Authority had admitted an application filed under Section 9 of the Code by Respondent No. 1. The appeal was filed on May 17, 2021. The Tribunal considered submissions regarding a pre-existing dispute prior to the Demand Notice and the possibility of settlement, directing the Appellant/Promoter to handover assets and records to the IRP, ensuring the company remains a going concern.

## Facts

Basant Kumar (Appellant) filed an appeal against an order passed by the National Company Law Tribunal (NCLT), New Delhi, which admitted an application filed by SVS Cleanroom and Engineering System OPC Pvt. Ltd. (Respondent No. 1) under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Appellant argued that there was a pre-existing dispute prior to the Demand Notice and that the order was passed ex-parte without proper service of notice. The Respondent contended that no such pre-existing dispute existed and that the notice was validly served. The NCLAT observed that the Corporate Debtor had raised disputes in its reply to the Demand Notice but never appeared before the Adjudicating Authority. The Resolution Professional's fees had not been paid since November

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority erred in admitting the application under Section 9 of the …

**Ratio:** The existence of a pre-existing dispute prior to the issuance of a demand notice under

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**Reasoning:** The Tribunal noted that the Corporate Debtor had raised disputes in its reply to the

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**Interpretation:** The interpretation of 'pre-existing dispute' is crucial in determining the

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**Application:** In this case, the Tribunal applied the principle by setting aside the order and

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## Parties

- **Judges:** Rakesh…; Dr.Alok Sri…
- **Appellants:** Basant…
- **Respondents:** SVS Cleanroom and…

## Timeline

- **2021-04-09 — Order by…**: The National Company Law Tribunal, New Delhi, passed an order in CP(IB) No. 1051/ND/2020…
- **2021-05-17 — Appeal F…**: The present appeal was…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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