# In the matter of Best Textiles Ltd. (IB)-17 (ND)-2018

> NCLT judgment dated 2018-04-03. Citation: TCN-2018-NCLT-01606. SBS Transpole Logistics Pvt. Ltd., an operational creditor, filed a petition under Section 9 of…

- **Court:** NCLT
- **Order date:** 3 Apr 2018
- **Citation:** TCN-2018-NCLT-01606
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/best-textiles-ltd-ib-17-nd-2018-a2c19f0d

## Summary

### Background

SBS Transpole Logistics Pvt. Ltd., an operational creditor, filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Best Textiles Ltd., the corporate debtor, due to its inability to pay a debt of Rs. 26,61,813. The operational creditor is in the logistics business, specializing in supply chain management, while the corporate debtor deals in raw cotton, polyester filaments, and fabrics. An agreement existed between the parties for the transportation of goods, with invoices raised from June 6, 2011, to March 7, 2015, totaling Rs. 1,53,10,151. The outstanding amount pertains to invoices raised between March 24, 2014, and July 2, 2014. The corporate debtor acknowledged the debt and promised payment but failed to liquidate it.

## Facts

SBS Transpole Logistics Pvt. Ltd. (Operational Creditor) provided logistics services to Best Textiles Ltd. (Corporate Debtor) under an agreement. Invoices were raised between 2011 and 2015, with an outstanding amount of Rs. 26,61,813 pertaining to invoices from March 2014 to July 2014. The Corporate Debtor acknowledged the debt and promised payment. The Operational Creditor issued a legal notice in 2015 and a notice under Rule 5 of the Insolvency and Bankruptcy Rules 2016. The Corporate Debtor raised objections, including disputes over service quality, limitation, and the validity of the demand notice. The Corporate Debtor claimed the running account was never reconciled and alleged false bills. Emails exchanged between the parties showed the Corporate Debtor

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor is liable to pay the outstanding debt of Rs. 26,61,813 to the …

**Ratio:** The principle is that if a debt is acknowledged and there is no dispute regarding the

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**Reasoning:** The court relied on the emails exchanged between the parties, where the Corporate Debtor

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**Interpretation:** This issue involves the interpretation of Section 9 of the Insolvency and

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**Application:** In this case, the Corporate Debtor acknowledged the debt through emails and

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## Parties

- **Judges:** DeepaKr…; Ina Mal…
- **Appellants:** SBS Transpole…
- **Respondents:** Best Textil…

## Timeline

- **2011-06-06 — Agreement Ex…**: Agreement executed between SBS Transpole Logistics Pvt. Ltd. and Best Textiles Ltd. for…
- **2015-01-01 — Legal No…**: Legal notice issued by the Operational Creditor under Section 434(A) of the Companies…

## 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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