# In the matter of Chawla Silica Sand Trading Co. vs. Indo Farm Equipments Ltd. Company Appeal (AT) (Insolvency) No. 468 of 2023

> NCLAT judgment dated 2023-04-24. Citation: TCN-2023-NCLAT-00581. This is a Company Appeal (AT) (Insolvency) No. 468 of 2023. The appeal was filed against the…

- **Court:** NCLAT
- **Order date:** 24 Apr 2023
- **Citation:** TCN-2023-NCLAT-00581
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/chawla-silica-sand-trading-co-vs-indo-farm-equipments-ltd-company-appeal-0da83fe8

## Summary

### Background

This is a Company Appeal (AT) (Insolvency) No. 468 of 2023. The appeal was filed against the order dated 21.02.2023, by which the Adjudicating Authority rejected Section 9 application on the ground that there was a pre-existing dispute between the parties. The appellant contends that the notice under Section 8 was sent by email on 12th November 2019 and through registered post received on 15th November 2019. The corporate debtor filed a civil suit on 14th November 2019. The appellant argues that this cannot be considered a pre-existing dispute to reject the application under Section 9 of IBC, claiming no pre-existing dispute and amounts were due from 2015.

## Facts

Chawla Silica Sand Trading Co. (Appellant) filed an appeal against the order dated 21.02.2023, rejecting its Section 9 application under the IBC. The Adjudicating Authority rejected the application due to a pre-existing dispute with Indo Farm Equipments Ltd. (Respondent). The Appellant sent a Section 8 notice via email on 12.11.2019 and registered post on 15.11.2019. The Respondent filed a civil suit on 14.11.2019. The Appellant claims no pre-existing dispute, with amounts due since 2015. The Respondent raised concerns about the rates of Silica Sand. A meeting was held on 12.11.2019, attended by Mr. Bharat Chawla, representing the Appellant. The Appellant reduced rates via email on 23.10.2019. The Respondent filed a civil suit for recovery of Rs. 9,82,835/-. The

…

## Issues and analysis

### Issue 1: Whether the Adjudicating Authority erred in rejecting the Section 9 application based on the …

**Ratio:** The ratio from Mobilox Innovations Private Limited Vs. Kirusa Software Private Limited

…

**Reasoning:** The NCLAT reasoned that the chronological development of facts, including the meeting

…

**Interpretation:** The existence of a 'dispute' under Section 9 of the IBC is interpreted broadly

…

**Application:** In this case, the NCLAT applied the Mobilox ratio by determining that a dispute

…

## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** Chawla Silica…
- **Respondents:** Indo Farm…

## Timeline

- **2019-10-23 — Appellant sends email…**: Chawla Silica Sand Trading Co. sends an…
- **2019-11-12 — Meeting betwee…**: A meeting was held between the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclat-new-delhi/chawla-silica-sand-trading-co-vs-indo-farm-equipments-ltd-company-appeal-0da83fe8