# In the matter of Abra Motors Private Limited IBA-42-2020

> NCLT judgment dated 2020-05-08. Citation: TCN-2020-NCLT-01370. The application was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by M/s.…

- **Court:** NCLT
- **Order date:** 8 May 2020
- **Citation:** TCN-2020-NCLT-01370
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/abra-motors-private-limited-iba-42-2020-63cfe647

## Summary

### Background

The application was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by M/s. Home Tech Services Private Limited (Operational Creditor) against M/s. Abra Motors Private Limited (Corporate Debtor) to initiate the Corporate Insolvency Resolution Process (CIRP). The Operational Creditor sought to initiate CIRP against the Corporate Debtor due to unpaid operational debt. The Operational Creditor is a security agency that provided security services to the Corporate Debtor under a Service Agreement dated 01.08.2011.

## Facts

M/s. Home Tech Services Private Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Abra Motors Private Limited (Corporate Debtor). The Operational Creditor provided security services to the Corporate Debtor under a Service Agreement dated 01.08.2011. The Operational Creditor claimed that the Corporate Debtor defaulted on payments for these services. The Corporate Debtor admitted to a liability of Rs. 5,27,460/- in a letter dated 14.12.2018, citing financial difficulties. The Operational Creditor issued a demand notice on 04.11.2019, which was received by the Corporate Debtor on 08.11.2019, but no payment or reply was received. The total

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the Insolvency and …

**Ratio:** Section 9 of the Insolvency and Bankruptcy Code, 2016 allows an operational creditor to

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**Reasoning:** The NCLT considered the documents and submissions made by both parties and found that the

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**Interpretation:** Section 9 provides the mechanism for operational creditors to recover their

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**Application:** The NCLT determined that the Operational Creditor had followed the correct

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## Parties

- **Judges:** R. VARADH…; Anil Ku…
- **Respondents:** M/s. Abra Motors…
- **Advocates:** P.J. Sri…; Swarnam J.…

## Timeline

- **2011-08-01 — Service Agr…**: Service Agreement for Security Services was entered between the Operational Creditor and…
- **2018-11-01 — Payment D…**: Corporate Debtor started…

## 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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