# In the matter of Sodexo India Services Pvt. Ltd. Vs. Chemizol Additives Pvt. Ltd Comp. App. (AT) (Ins) No. 1094 of 2020

> NCLAT judgment dated 2021-02-22. Citation: TCN-2021-NCLAT-00358. The case involves an appeal against the order of the Adjudicating Authority (National Company…

- **Court:** NCLAT
- **Order date:** 22 Feb 2021
- **Citation:** TCN-2021-NCLAT-00358
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/sodexo-india-services-pvt-ltd-vs-chemizol-additives-pvt-ltd-comp-app-f52b9775

## Summary

### Background

The case involves an appeal against the order of the Adjudicating Authority (National Company Law Tribunal, Bengaluru Bench) which disposed of an application filed by Sodexo India Services Pvt. Ltd. (Appellant - Operational Creditor) under Section 9 of the Insolvency and Bankruptcy Code, 2016 (I&B Code). The Adjudicating Authority directed Chemizol Additives Pvt. Ltd. (Respondent - Corporate Debtor) to attempt resolution of the outstanding debt before the Appellant could invoke the arbitration clause. The Appellant contended that the Adjudicating Authority erred in not admitting the application, especially since the Corporate Debtor had not raised any dispute regarding the debt.

## Facts

Sodexo India Services Pvt. Ltd. (Appellant), an Operational Creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 against Chemizol Additives Pvt. Ltd. (Respondent), the Corporate Debtor, for non-payment of outstanding operational debt. The Adjudicating Authority (NCLT, Bengaluru Bench) disposed of the application, directing the Corporate Debtor to make efforts to resolve the outstanding debt before the Appellant could invoke the arbitration clause in their agreement dated December 14, 2015. The Appellant argued that the Corporate Debtor had not responded to the Demand Notice dated December 18, 2018, demanding the outstanding amount for four invoices. The Adjudicating Authority observed that mere acceptance of the debt by the

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## Issues and analysis

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

**Ratio:** Section 9(5) of the I&B Code mandates that the Adjudicating Authority shall, within

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**Reasoning:** The Appellate Tribunal reasoned that the Adjudicating Authority's approach was not in

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**Interpretation:** Section 9(5) of the I&B Code provides a clear framework for the

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**Application:** In this case, the Adjudicating Authority's direction to the Corporate Debtor to

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## Parties

- **Judges:** Bansi Lal…; Ashok Kumar…
- **Appellants:** Sodexo India…
- **Respondents:** Chemizol Additives…
- **Advocates:** Gaurav…; Y. P. Dan…; +3 more

## Timeline

- **2020-06-08 — Order of Adjudicating…**: The Adjudicating Authority (NCLT, Bengaluru Bench) passed an order directing the…
- **2015-12-14 — Agreement…**: Date of the agreement between the Appellant and the Respondent containing the arbitration…

## 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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