# In the matter of Jaya Patel Vs. Gas Jeans Pvt. Ltd. & Ors. CA (AT) No. 308-2018

> NCLAT judgment dated 2018-10-08. Citation: TCN-2018-NCLAT-00086. The Respondent, Gas Jeans Pvt. Ltd., initiated proceedings under Sections 433-434 of the…

- **Court:** NCLAT
- **Order date:** 8 Oct 2018
- **Citation:** TCN-2018-NCLAT-00086
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/jaya-patel-vs-gas-jeans-pvt-ltd-ors-ca-07c21cd4

## Summary

### Background

The Respondent, Gas Jeans Pvt. Ltd., initiated proceedings under Sections 433-434 of the Companies Act, 1956 in the Bombay High Court seeking the winding up of Vama Apparels India Pvt. Ltd. for a debt of Rs. 21,63,359. The case was transferred to the NCLT, Mumbai Bench, following Rule 5 of the Companies (Transfer of pending proceedings) Rule, 2016. Gas Jeans Pvt. Ltd. then filed Form-5 r/w Rule 6 to treat the application as one under Section 9 of the Insolvency and Bankruptcy Code, 2016 (I&B Code). The Adjudicating Authority admitted the application, declared a moratorium, and appointed an Interim Resolution Professional via an order dated May 17, 2018. The Appellant, the Director of the Corporate Debtor, challenged this order, arguing that the notice under Section

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## Facts

Gas Jeans Pvt. Ltd. initiated proceedings to wind up Vama Apparels India Pvt. Ltd. in the Bombay High Court due to an outstanding debt of Rs. 21,63,359. The case was transferred to the NCLT, Mumbai. Gas Jeans Pvt. Ltd. then sought to initiate Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code (I&B Code). The Adjudicating Authority admitted the application, declared a moratorium, and appointed an Interim Resolution Professional on May 17, 2018. Jaya Patel, the Director of the Corporate Debtor, challenged this order, arguing that the notice under Section 8(1) of the I&B Code was issued on the same date as the filing of Form-5 under Rule 9. Gas Jeans Pvt. Ltd. acknowledged that the notice under Section 8(1) was

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority's order admitting the application under Section 9 of the …

**Ratio:** Section 9 of the I&B Code stipulates that an application for initiation of CIRP by an

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**Reasoning:** The Appellate Tribunal reasoned that the simultaneous issuance of the notice under

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**Interpretation:** Section 9 is interpreted to mean that there must be a clear separation in time

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**Application:** In this case, since the notice under Section 8(1) was issued on the same date

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…
- **Appellants:** Jaya P…
- **Respondents:** Vama Apparels…; Gas Jeans Pvt.…
- **Advocates:** Krishnendu…; Priyadarshi…; +3 more

## Timeline

- **1956-01-01 — Application under…**: Gas Jeans Pvt. Ltd. preferred an application under Section 433-434 of the Companies Act,…
- **2016-01-01 — Transfer o…**: The case was transferred pursuant to Rule 5 of the Companies (Transfer of pending…

## 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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