# In the matter of Aradhya Steel Private Limited C.P. (IB) No. 227-BB-2019

> NCLT judgment dated 2019-08-29. Citation: TCN-2019-NCLT-01695. M/s.Peddington Chemical Industries (India), an operational creditor, filed a petition under…

- **Court:** NCLT
- **Order date:** 29 Aug 2019
- **Citation:** TCN-2019-NCLT-01695
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/aradhya-steel-private-limited-cp-ib-no-227-bb-2019-a55eeb62

## Summary

### Background

M/s.Peddington Chemical Industries (India), an operational creditor, filed a petition under Section 9 of the IBC, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s.Aradhya Steel Private Limited, the corporate debtor, due to a default of Rs.24,29,998.60/-. The operational creditor supplied lubricants to the corporate debtor based on purchase orders, but the corporate debtor failed to make payments within the agreed 60-day credit period, despite repeated requests and a demand notice.

## Facts

M/s.Peddington Chemical Industries (India) filed C.P. (IB) No. 227/BB/2019 under Section 9 of the IBC, 2016, against M/s.Aradhya Steel Private Limited, claiming a default of Rs.24,29,998.60/-. Peddington Chemical Industries supplied lubricants to Aradhya Steel based on purchase orders. Aradhya Steel failed to make payments within the agreed 60-day credit period. Peddington Chemical Industries issued a demand notice on 19.03.2019. Aradhya Steel admitted the debt but cited financial difficulties. Union Bank of India, a financial creditor, supported the CIRP initiation. Aradhya Steel's account was classified as a non-performing asset as of 31.03.2019. Other operational creditors of Aradhya Steel had also issued Form-3 notices. The Managing Director of Aradhya Steel had

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## Issues and analysis

### Issue 1: Whether the petition filed by the operational creditor under Section 9 of the IBC, 2016, is …

**Ratio:** Section 9 of the IBC, 2016, allows an operational creditor to initiate CIRP against a

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**Reasoning:** The NCLT considered the provisions of Section 9 of the IBC, 2016, and the documents

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**Interpretation:** Section 9 of the IBC, 2016, provides a mechanism for operational creditors to

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**Application:** The NCLT found that the operational creditor had complied with the requirements

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## Parties

- **Judges:** Rajeswara Rao…; Ashok Kumar…
- **Appellants:** M/s.Peddington…
- **Respondents:** M/s.Aradhya Steel…

## Timeline

- **1989-01-09 — Incorporation of…**: M/s.Aradhya Steel Pvt.…
- **2018-09-21 — Purchase…**: Purchase Order…

## 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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