# In the matter of Trafigura India Pvt Ltd Vs TDT Copper Ltd, Company Appeal (AT)(Insolvency)No.742 of 2020

> NCLAT judgment dated 2022-09-15. Citation: TCN-2022-NCLAT-00217. This case involves an appeal against an order dated 15.07.2020 passed by the Adjudicating…

- **Court:** NCLAT
- **Order date:** 15 Sept 2022
- **Citation:** TCN-2022-NCLAT-00217
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/trafigura-india-pvt-ltd-vs-tdt-copper-ltd-company-appeal-cec347db

## Summary

### Background

This case involves an appeal against an order dated 15.07.2020 passed by the Adjudicating Authority (National Company Law Tribunal, New Delhi Bench Court-V) in Company Petition (IB) No. 2817/ND/2019. The appellant, Trafigura India Private Limited, filed the appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016, being aggrieved by the Adjudicating Authority's order. The dispute arose from a Master Sale Agreement (MSA) dated 27.01.2016 between Trafigura and TDT Copper Limited, where Trafigura agreed to sell copper cathodes to TDT. TDT allegedly failed to make payments as per the MSA, leading to a Settlement Agreement on 20.11.2018. Despite the settlement, TDT allegedly defaulted on payments, prompting Trafigura to issue a demand notice and subsequently file

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## Facts

Trafigura India Private Limited (Appellant) and TDT Copper Limited (Respondent) entered into a Master Sale Agreement (MSA) on 27.01.2016, where Trafigura agreed to sell copper cathodes to TDT. The terms of the MSA governed the rights and obligations of both parties. TDT was required to place purchase orders regularly, and Trafigura was obligated to supply the material as specified in those orders. Trafigura would raise invoices for the material supplied, and TDT was required to pay within 30 days of the invoice date, with interest applicable for late payments. TDT failed to make payments according to the MSA, leading to discussions and a Settlement Agreement on 20.11.2018. The Settlement Agreement extended the MSA terms to 31.12.2018 and provided for a full and final

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## Issues and analysis

### Issue 1: Whether the claims arising under the Settlement Agreement constitute an 'operational debt' under …

**Ratio:** The legal principle is that an 'operational debt' must arise from the provision of goods

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**Reasoning:** The court reasoned that the Settlement Agreement was an acknowledgment of liability

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**Interpretation:** The interpretation of 'operational debt' under Section 5(21) of the IBC is

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**Application:** In this case, the court applied the principle by determining that the

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## Parties

- **Judges:** Anant Bijay…; Shreesha…
- **Appellants:** Trafigura India…
- **Respondents:** TDT Copper…
- **Advocates:** Krishnendu…; Anjali An…; +3 more

## Timeline

- **2016-01-27 — Master Sale Agreement…**: Trafigura and TDT Copper entered into a Master Sale Agreement (MSA) for the supply of…
- **2018-11-20 — Settlement Ag…**: Parties entered into a Settlement Agreement due to non-payment under the MSA, extending…

## 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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