# In the matter of AVK Automart Pvt. Ltd. CP No. 2921-I&BP-2018

> NCLT judgment dated 2018-11-06. Citation: TCN-2018-NCLT-00373. Beli Sharma and Company filed a Company Petition seeking to initiate the Corporate Insolvency…

- **Court:** NCLT
- **Order date:** 6 Nov 2018
- **Citation:** TCN-2018-NCLT-00373
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/avk-automart-pvt-ltd-cp-no-2921-ibp-2018-a658185a

## Summary

### Background

Beli Sharma and Company filed a Company Petition seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against AVK Automart Private Limited, alleging a default in payment of Rs. 1,31,100/-. The petition was filed under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, read with Rule 6 of the Insolvency & Bankruptcy (AAA) Rules, 2016. The petitioner had raised an invoice dated 24.08.2015 for professional services rendered to the Corporate Debtor. A demand notice was issued under Section 8 of the Code on 03.04.2018, but no reply was received from the Corporate Debtor.

## Facts

Beli Sharma and Company (the Petitioner) filed a petition to initiate Corporate Insolvency Resolution Process (CIRP) against AVK Automart Private Limited (the Corporate Debtor). The Petitioner claimed that the Corporate Debtor defaulted on a payment of Rs. 1,31,100/-. The default allegedly occurred on 24.09.2015. The Petitioner had issued an invoice dated 24.08.2015 for professional services rendered. After the payment was not made, the Petitioner issued a demand notice on 03.04.2018 under Section 8 of the IBC. The Corporate Debtor did not respond to the demand notice. The Respondent's counsel admitted the debt and default and did not object to the admission of the petition. This admission was a key factor in the court's decision to admit the petition and initiate CIRP.

## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor is in compliance with the provisions of …

**Ratio:** The Insolvency and Bankruptcy Code (IBC) outlines the procedure for initiating CIRP by an

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**Reasoning:** The court was satisfied that the application filed by the Operational Creditor met the

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**Interpretation:** Sections 8 and 9 of the IBC are interpreted to ensure that operational

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**Application:** The court applied the provisions of Sections 8 and 9 to the facts of the case,

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## Parties

- **Judges:** Bhaskara Pantula…; V. Nallasen…
- **Appellants:** Beli Sharma and…
- **Respondents:** AVK Automart…
- **Advocates:** KunalKa…; Khushboo Shah…

## Timeline

- **2015-08-24 — Invoice R…**: The Petitioner raised an invoice for Rs. 1,31,100/- on the Corporate Debtor for…
- **2015-09-24 — Default…**: Alleged date of default in…

## 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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