# In the matter of Jangsher Singh Choudhary Vs.
Ram Kripal Singh Construction Pvt. Ltd. Company Appeal (AT) (Ins) No. 739 of 2021

> NCLAT judgment dated 2022-08-08. Citation: TCN-2022-NCLAT-00294. The appeal was filed under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC),…

- **Court:** NCLAT
- **Order date:** 8 Aug 2022
- **Citation:** TCN-2022-NCLAT-00294
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/jangsher-singh-choudhary-vs-ram-kripal-singh-construction-pvt-ltd-company-appeal-c77ee918

## Summary

### Background

The appeal was filed under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC), against an order dated 26.02.2020 passed by the National Company Law Tribunal (NCLT), Kolkata Bench, which rejected the petition filed under Section 9 of the IBC on behalf of the Appellant for initiating Corporate Insolvency Resolution Process (CIRP). The NCLT dismissed the petition primarily because of a pre-existing dispute, relying on the Supreme Court judgment in Mobilox Innovations Pvt. Ltd Vs. Kirusa Software Pvt. Ltd.

## Facts

Jangsher Singh Choudhary, proprietor of M/s Capital Fire Engineering Co. (Operational Creditor), filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against M/s Ram Kripal Singh Construction Private Limited (Corporate Debtor) to initiate Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor allegedly defaulted in paying an operational debt of Rs. 1,38,63,233.65. The Operational Creditor had set up a fire and safety system for the Corporate Debtor and raised a total bill of Rs. 1,25,28,196. The Corporate Debtor did not pay the debt, leading the Operational Creditor to file a suit for recovery in the Court of Additional District Judge, Gurugram District Courts, Haryana, in 2014 (Civil Suit No. 111 of 2014). The Ld. Judge

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## Issues and analysis

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

**Ratio:** The ratio is that the existence of a pre-existing dispute, as defined under the IBC and

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**Reasoning:** The court reasoned that the Adjudicating Authority erred in rejecting the application

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**Interpretation:** The interpretation is that the 'pre-existing dispute' must be a genuine dispute

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**Application:** In this case, the court found that the Respondent did not raise any dispute at

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## Parties

- **Judges:** Rakesh…; Ashok Kumar…
- **Appellants:** Jangsher Singh…
- **Respondents:** Ram Kripal Singh…; Ram Kripal Singh…

## Timeline

- **2014-01-01 — Civil Suit…**: Operational Creditor filed a suit for recovery in the Court of Additional District Judge,…
- **2018-12-07 — Decree P…**: Ld. Judge decreed the suit in…

## 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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