# In the matter of Duraent Biologicals Limited CP (IB)-202(CHE)-2021

> NCLT judgment dated 2022-01-06. Citation: TCN-2022-NCLT-04521. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 6 Jan 2022
- **Citation:** TCN-2022-NCLT-04521
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/duraent-biologicals-limited-cp-ib-202che-2021-3991886f

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by Raj Metro Life Sciences Private Limited (Operational Creditor) against Duraent Biologicals Limited (Corporate Debtor) for initiation of Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed a default of Rs. 3,07,38,876 as of 31.03.2019. The Operational Creditor and Corporate Debtor had entered into an agency agreement in 2010, where the Operational Creditor invested in the Corporate Debtor's business and was entitled to a minimum return and sales commission. The Corporate Debtor started returning payments in 2014 but failed to pay the balance amount. The Operational Creditor issued legal notices and a demand notice, but no repayment or

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## Facts

Raj Metro Life Sciences Private Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Duraent Biologicals Limited (Corporate Debtor) for initiating the Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed a default of Rs. 3,07,38,876 as of March 31, 2019. The Corporate Debtor is a public limited company incorporated on June 24, 2010. The Operational Creditor is a private limited company. The Operational Creditor and the Corporate Debtor entered into an Agency Agreement dated October 16, 2010, for a period of three years, which included an auto-renewal provision. The Operational Creditor invested in the Corporate Debtor's business, entitling them to a minimum return of 2.5%

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## Issues and analysis

### Issue 1: Whether the debt in question is an operational debt as defined under the Insolvency and Bankruptcy …

**Ratio:** An 'operational debt' means a claim in respect of the provision of goods or services,

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**Reasoning:** The court considered the definitions of 'debt' and 'operational debt' under Sections

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**Interpretation:** The interpretation of 'operational debt' is broad and encompasses claims

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**Application:** The court applied the definition of 'operational debt' and the interpretation

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## Parties

- **Judges:** (Retd.) S.…; Anil Ku…
- **Appellants:** M/s. Raj Metro…
- **Respondents:** M/s. Duraent…

## Timeline

- **2010-10-16 — Agency Agr…**: Agency Agreement entered into between Raj Metro Life Sciences Private Limited and Duraent…
- **2011-12-29 — Business Relationship…**: Business Relationship Agreement entered into between Raj Metro Life Sciences Private…

## 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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