# In the matter of Delight Switchgears Private Limited IBA-294-2020

> NCLT judgment dated 2021-04-27. Citation: TCN-2021-NCLT-02286. M/s. Fomra Electricals (Operational Creditor) filed an application under Section 9 of the…

- **Court:** NCLT
- **Order date:** 27 Apr 2021
- **Citation:** TCN-2021-NCLT-02286
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/delight-switchgears-private-limited-iba-294-2020-f83188f1

## Summary

### Background

M/s. Fomra Electricals (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against M/s. Delight Switchgears Private Limited (Corporate Debtor) for initiation of Corporate Insolvency Resolution Process (CIRP) due to a default of Rs. 28,02,766/- along with 24% per annum interest. The Operational Creditor claimed that the Corporate Debtor defaulted on payments for supplied electrical components. The Corporate Debtor, however, contested the claim, alleging suppression of material facts and the existence of a pre-existing dispute regarding the amount due.

## Facts

M/s. Fomra Electricals, an operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against M/s. Delight Switchgears Private Limited, the corporate debtor, claiming a default of Rs. 28,02,766/- along with 24% per annum interest. The claim arose from the supply of electrical components. The operational creditor submitted that a total debt of Rs. 16,20,000/- was outstanding, with interest accruing at 24% per annum from the due date of invoices until 12.10.2019. A sum of Rs. 49,052/- had been paid against an invoice. The operational creditor issued a demand notice under Section 8 of the IBC on 19.10.2019, but received no reply. The corporate debtor denied the allegations, stating suppression of material facts and the

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## Issues and analysis

### Issue 1: Whether the Applicant is entitled to claim interest at the rate of 24% per annum based on the …

**Ratio:** The Adjudicating Authority cannot isolate one invoice and conclude that the amount is due

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**Reasoning:** The court reasoned that determining the entitlement to interest and the applicable rate

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**Interpretation:** The interpretation is that claims for interest on delayed payments, especially

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**Application:** In this case, the Operational Creditor's claim for interest was based on a

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## Parties

- **Judges:** R. Sucha…; B. Anil…
- **Appellants:** M/s. Fomra…
- **Respondents:** M/s. Delight…

## Timeline

- **2017-06-16 — Purchase Ord…**: Corporate Debtor issued a…
- **2017-06-29 — Invoice…**: One invoice was dated 29.06.2017, with a total…

## 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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