# In the matter of Mohammad Moinuddin Khan vs. Saraswati Wire & Cable Industries and Anr.

> NCLAT judgment dated 2024-03-13. Citation: TCN-2024-NCLAT-00581. This case involves an appeal against the admission of a Section 9 application under the…

- **Court:** NCLAT
- **Order date:** 13 Mar 2024
- **Citation:** TCN-2024-NCLAT-00581
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/mohammad-moinuddin-khan-vs-saraswati-wire-cable-industries-and-anr-745282dc

## Summary

### Background

This case involves an appeal against the admission of a Section 9 application under the Insolvency and Bankruptcy Code (IBC) by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench-IV). The appeal was filed by the Suspended Director of the Corporate Debtor, Dhanlaxmi Electricals Private Limited, challenging the order dated 06.12.2023. The Operational Creditor, Saraswati Wire & Cable Industries, claimed an outstanding amount for the supply of AB Cables. The Corporate Debtor argued that there was a pre-existing dispute regarding the quality and quantity of the supplied cables, as well as debit notes issued for faulty cables and non-supply of materials.

## Facts

Dhanlaxmi Electricals Private Limited (Corporate Debtor) is a licensed contractor and engineer. Saraswati Wire & Cable Industries (Operational Creditor) supplied AB Cables to the Corporate Debtor. Invoices were raised from 2019-09-29 to 2019-10-06. On 2021-08-04, the Corporate Debtor's Account Manager emailed the Operational Creditor, pointing out ledger differences. The ledger reflected a closing balance of Rs. 1,79,93,690/- as of 2022-03-30. On 2021-08-25, the Operational Creditor issued a demand notice for Rs. 1,79,93,691/- + interest of Rs. 85,27,110/-, totaling Rs. 2,85,20,800/-. An advance copy of the Section 9 application was sent on 2021-11-09. The Corporate Debtor sent a notice of dispute on 2021-11-20, declining the demand, citing issues and debit notes

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## Issues and analysis

### Issue 1: Whether a pre-existing dispute existed between the Corporate Debtor and the Operational Creditor …

**Ratio:** The ratio is based on the interpretation of Sections 8 and 9 of the IBC, which stipulate

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**Reasoning:** The Appellate Tribunal reasoned that the Adjudicating Authority failed to properly

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**Interpretation:** The interpretation of Sections 8 and 9 of the IBC is that the existence of a

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**Application:** In this case, the Appellate Tribunal found that the Corporate Debtor had

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## Parties

- **Judges:** Ashok Bh…; Barun M…; +1 more
- **Appellants:** Mohammad Moinuddin…
- **Respondents:** Dhanlaxmi…; M/s. Saraswati…

## Timeline

- **2019-09-29 — Invoices…**: Operational Creditor raised invoices to…
- **2019-10-06 — Invoices…**: Operational Creditor raised invoices to…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 8 — Insolvency resolution by operational creditor](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-8)

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