# In the matter of Naik Environmental Engineers Pvt. Ltd. Vs. Lucina Land Development Ltd. CA(AT)(Ins)No. 543 of 2019

> NCLAT judgment dated 2019-12-03. Citation: TCN-2019-NCLAT-00061. Naik Environmental Engineers Pvt. Ltd. filed an application under Section 9 of the Insolvency…

- **Court:** NCLAT
- **Order date:** 3 Dec 2019
- **Citation:** TCN-2019-NCLAT-00061
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/naik-environmental-engineers-pvt-ltd-vs-lucina-land-development-ltd-ca-9ff46719

## Summary

### Background

Naik Environmental Engineers Pvt. Ltd. filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) before the Adjudicating Authority (National Company Law Tribunal, New Delhi Court No.IV) against Lucina Land Development Ltd. The application was dismissed due to the pre-existence of a dispute. Naik Environmental Engineers Pvt. Ltd. then filed an appeal against this dismissal.

## Facts

Naik Environmental Engineers Pvt. Ltd. (Appellant) supplied Organic Waste Compositing Machines (OWC) to Lucina Land Development Ltd. (Respondent). The Appellant claimed that the Respondent placed a purchase order for a machine worth Rs.10,60,000/- on October 4, 2016, which was delivered on October 24, 2016. A second invoice related to two machines was placed on November 16, 2016, and delivered on February 6, 2017, with a bill raised for Rs.20,14,000/-. The Appellant stated that the purchase order required 10% advance, 70% at delivery, 10% at installation, and 10% at commissioning. The Appellant claimed that only Rs.6,92,000/- was paid on June 2, 2017, amounting to 65% of the first invoice. The Appellant also claimed that nothing was paid for the second purchase order.

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## Issues and analysis

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

**Ratio:** The existence of a pre-existing dispute bars the initiation of corporate insolvency

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**Reasoning:** The court found that the email correspondence between the parties demonstrated that

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**Interpretation:** The presence of a genuine dispute, raised before the application under Section

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**Application:** In this case, the court determined that the disputes raised by the Respondent

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## Parties

- **Judges:** A.I.S. C…; KanthiNar…; +1 more
- **Appellants:** M/s. Naik…
- **Respondents:** M/s. Lucina Land…

## Timeline

- **2016-10-04 — First Purchas…**: Respondent placed the first purchase…
- **2016-10-24 — Delivery of First…**: The machine from the first…

## 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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