# In the matter of CAPL Hotels and Spa Pvt. Ltd. IB-1926-(ND)-2019

> NCLT judgment dated 2021-02-01. Citation: TCN-2021-NCLT-03173. Knight Frank (India) Private Limited, the Operational Creditor, filed a petition under Section…

- **Court:** NCLT
- **Order date:** 1 Feb 2021
- **Citation:** TCN-2021-NCLT-03173
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/capl-hotels-and-spa-pvt-ltd-ib-1926-nd-2019-c8ea5e24

## Summary

### Background

Knight Frank (India) Private Limited, the Operational Creditor, filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against CAPL Hotels and Spa Private Ltd, the Corporate Debtor, due to an alleged default of Rs. 1,53,69,221/-. The Operational Creditor provided services related to leasing arrangements for the Corporate Debtor's Galaxy Hotel. Despite the Corporate Debtor making a partial payment via cheque, the cheque was returned due to insufficient funds. Demand notices were served, but no settlement was reached.

## Facts

Knight Frank (India) Private Limited (Operational Creditor) sought to initiate CIRP against CAPL Hotels and Spa Private Ltd (Corporate Debtor) under Section 9 of IBC, 2016, for a default of Rs. 1,53,69,221/-. The Operational Creditor was engaged as an exclusive agency for arranging lease/rent of Galaxy Hotel for the Corporate Debtor. A lease agreement was signed on 01.10.2018, and the lease deed was stamped and registered on 24.01.2019. The Operational Creditor completed its scope of work as agreed upon on 16.02.2018. On 29.01.2019, the applicant communicated to the Corporate Debtor about the completion of work. The consideration for services was Rs. 2,62,32,887/-, later revised to Rs. 1,77,85,008/-. The Corporate Debtor paid Rs. 1,50,97,060/- via cheque on 30.04.2019,

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## Issues and analysis

### Issue 1: Whether the Operational Creditor has established the existence of debt and default on the part of …

**Ratio:** The initiation of CIRP under Section 9 of the IBC requires the establishment of a debt

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**Reasoning:** The Tribunal reasoned that the Operational Creditor presented sufficient evidence,

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

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**Application:** In this case, the Operational Creditor provided evidence of unpaid invoices, a

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## Parties

- **Judges:** SHRI. P.S.N.…; V.K. SUB…
- **Appellants:** Knight Frank…
- **Respondents:** CAPL Hotels and…

## Timeline

- **2018-02-16 — Engagement of…**: The applicant was engaged as an exclusive agency for arranging lease/rent of Galaxy Hotel…
- **2018-10-01 — Lease Agreemen…**: The lease agreement was signed by the Corporate Debtor and the lessee after obtaining the…

## 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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