# In the matter of Apace Builders and Contractors Pvt. Ltd. Company Petition No. IB 2339-ND-2019

> NCLT judgment dated 2021-02-05. Citation: TCN-2021-NCLT-03115. Pradeep Kumar & Co., an operational creditor, filed an application under Section 9 of the…

- **Court:** NCLT
- **Order date:** 5 Feb 2021
- **Citation:** TCN-2021-NCLT-03115
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/apace-builders-and-contractors-pvt-ltd-company-petition-no-ib-2339-nd-2019-92fbf3a8

## Summary

### Background

Pradeep Kumar & Co., an operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Apace Builders and Contractors Pvt. Ltd., the corporate debtor. The operational creditor claimed default in payment for the supply of wooden door frames, plywood, and wooden ribs. The corporate debtor raised objections regarding the maintainability of the application by a proprietorship firm, the quality of goods supplied, and the interest rate charged.

## Facts

Pradeep Kumar & Co., a sole proprietorship, supplied wooden door frames, plywood, and wooden ribs to Apace Builders and Contractors Pvt. Ltd. in 2018, based on purchase orders. The applicant raised invoices between April and October 2018. The corporate debtor allegedly failed to make payments for these supplies. The applicant issued a demand notice on 27.06.2017, claiming Rs. 16,72,339/- including interest up to 26.06.2019. The corporate debtor did not reply to the demand notice. The corporate debtor raised objections, including the maintainability of the application by a proprietorship firm and disputes regarding the quality of goods. The applicant filed a rejoinder, citing case laws to support the maintainability of the application and arguing that no

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## Issues and analysis

### Issue 1: Whether the application filed by the operational creditor, a sole proprietorship firm, is …

**Ratio:** The NCLT relied on the judgment of NCLAT in Neeta Saha Vs. Ram Niwas Gupta, which held

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**Reasoning:** The court considered the corporate debtor's objection that a proprietorship firm is not

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**Interpretation:** The interpretation of 'person' under the IBC includes a sole proprietorship,

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**Application:** The ratio from Neeta Saha Vs. Ram Niwas Gupta was directly applied to the

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## Parties

- **Judges:** DEEPTI M…; SUMITA PURK…; +1 more
- **Appellants:** Pradeep Kum…
- **Respondents:** Apace Builders…

## Timeline

- **2017-06-27 — Demand Notice…**: The applicant issued a demand notice under Section 8 of the IBC, calling upon the…
- **2018-03-01 — Supply P…**: Period during which invoices were…

## 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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