# In the matter of India Power Corporation Limited Vs. Dynamic Cables Limited & Anr. CA(AT)(Ins)No. 1221 of 2019

> NCLAT judgment dated 2020-05-22. Citation: TCN-2020-NCLAT-00262. This case involves an appeal against an order passed by the Adjudicating Authority (National…

- **Court:** NCLAT
- **Order date:** 22 May 2020
- **Citation:** TCN-2020-NCLAT-00262
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/india-power-corporation-limited-vs-dynamic-cables-limited-anr-ca-1592f424

## Summary

### Background

This case involves an appeal against an order passed by the Adjudicating Authority (National Company Law Tribunal), Kolkata Bench, which admitted an application filed by ‘M/s. Dynamic Cables Limited' (‘Operational Creditor') under Section 9 of the Insolvency and Bankruptcy Code, 2016, for initiating Corporate Insolvency Resolution Process against ‘M/s. India Power Corporation (Bodhgaya) Limited'- (‘Corporate Debtor'). The Operational Creditor alleged default of operational debt amounting to Rs. 2,32,46,235/-. The appellant, India Power Corporation Limited, contested the admission order primarily on the ground of pre-existence of a dispute.

## Facts

M/s. Dynamic Cables Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against M/s. India Power Corporation (Bodhgaya) Limited (Corporate Debtor) alleging default of operational debt amounting to Rs. 2,32,46,235/-. The Adjudicating Authority admitted the application, leading to the initiation of Corporate Insolvency Resolution Process and imposition of a moratorium. India Power Corporation Limited (Appellant) appealed the order, claiming a pre-existing dispute. The Corporate Debtor argued that the goods supplied by the Operational Creditor were substandard, referencing a letter dated 14th May, 2018, and an email dated 19th July, 2018, requesting the Operational Creditor to take back the cables. The

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## Issues and analysis

### Issue 1: Whether there was a pre-existing dispute, as raised by the ‘Corporate Debtor', that would not …

**Ratio:** The existence of a pre-existing dispute is a bar to the admission of an application under

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**Reasoning:** The Adjudicating Authority concluded that the dispute regarding the quality of goods was

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**Interpretation:** The court interpreted the correspondence and conduct of the parties to

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**Application:** The court applied the ratio to the facts of the case, noting that the Corporate

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## Parties

- **Judges:** Bansi Lal…; V. P. S…; +1 more
- **Appellants:** INDIA POWER…
- **Respondents:** M/s. India Power…; M/s. Dynamic…

## Timeline

- **2016-01-01 — Enactment of…**: The Insolvency and…
- **2018-05-14 — Letter from Corporate…**: Corporate Debtor allegedly sent a…

## 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)

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