# In the matter of Auto Mobiles Sterling (India) Pvt. Limited IB-1329-ND-2019

> NCLT judgment dated 2019-08-07. Citation: TCN-2019-NCLT-02067. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 7 Aug 2019
- **Citation:** TCN-2019-NCLT-02067
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/auto-mobiles-sterling-india-pvt-limited-ib-1329-nd-2019-5d529c0c

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016 by Adbridge Communications India (P) Ltd, the Operational Creditor, against Automobiles Sterlind (India) Pvt. Ltd, the Corporate Debtor, due to a default in payment for services rendered. The Operational Creditor claimed an amount of Rs. 8,12,536/- along with interest, aggregating to Rs. 10,39,871/-, arising from purchase orders placed by the Corporate Debtor for 'space in Print Media'. Despite a partial payment of Rs. 200,000/-, the Corporate Debtor failed to pay the balance, leading the Operational Creditor to issue a demand notice under Section 8 of the IBC, 2016.

## Facts

Abridge Communications India (P) Ltd, the Operational Creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016 against Automobiles Sterlind (India) Pvt. Ltd, the Corporate Debtor. The claim arose from unpaid invoices for 'space in Print Media' provided by the Operational Creditor to the Corporate Debtor based on purchase orders. The total claim amounted to Rs. 10,39,871/-, including principal (Rs. 8,12,536/-) and interest (Rs. 2,27,335/-). The debt was stated to have fallen due on 2018-03-16. A partial payment of Rs. 200,000/- was made, but the balance remained unpaid. The Operational Creditor issued a demand notice under Section 8 of the IBC on 2019-04-10, to which the Corporate Debtor responded on 2019-04-15. The Corporate

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the IBC, 2016, should be admitted given the default in …

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

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**Reasoning:** The court found that the Corporate Debtor admitted to owing a principal amount exceeding

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**Interpretation:** Section 9 of IBC is interpreted to mean that if the debt is above the threshold

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**Application:** The Corporate Debtor admitted to owing more than Rs. 100,000, so the

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## Parties

- **Judges:** R. VARADH…; K.K. V…
- **Appellants:** Adbbridge…
- **Respondents:** Automobiles…
- **Advocates:** Subrah M…; Ankit G…

## Timeline

- **2018-03-16 — Debt Due…**: The debt claimed by the Operational…
- **2019-04-10 — Demand N…**: The Operational Creditor sent a demand notice to the Corporate Debtor under Section 8 of…

## 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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