# In the matter of Encyclo Media Networks Private Limited CP No. 1306-IBC-NCLT-MB-MAH-2017

> NCLT judgment dated 2018-02-23. Citation: TCN-2018-NCLT-01782. The case pertains to an application filed under Section 9 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 23 Feb 2018
- **Citation:** TCN-2018-NCLT-01782
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/encyclo-media-networks-private-limited-cp-no-1306-ibc-nclt-mb-mah-2017-65575dbb

## Summary

### Background

The case pertains to an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by M/s. Autostriping India Private Limited, an operational creditor, against M/s. Encyclo Media Networks Private Limited, the corporate debtor, for default in payment of operational debt. The operational creditor claimed that the corporate debtor had availed services from them between 01.04.2014 and 19.07.2014, for which invoices were raised, but a significant portion of the debt remained unpaid.

## Facts

M/s. Autostriping India Private Limited (Operational Creditor) filed an application against M/s. Encyclo Media Networks Private Limited (Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Operational Creditor provided digital printing services to the Corporate Debtor between 01.04.2014 and 19.07.2014. Invoices totaling ₹25,11,954/- were raised, out of which ₹8,19,990/- was paid, with the last payment made on 25.07.2014. The Operational Creditor issued a demand notice under Section 8 of the Code on 15.06.2017, claiming an outstanding amount of ₹16,91,963/-, which was served on 18.06.2017. The Corporate Debtor did not respond to the notice. The Operational Creditor sent emails to the Corporate Debtor, who admitted the debt but cited

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## Issues and analysis

### Issue 1: Whether the debt claimed by the Operational Creditor qualifies as an 'Operational Debt' under …

**Ratio:** Section 5(21) of the Insolvency and Bankruptcy Code, 2016 defines 'Operational Debt' as a

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**Reasoning:** The court considered the invoices raised by the Operational Creditor for the services

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**Interpretation:** The interpretation of 'Operational Debt' under Section 5(21) is broad and

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**Application:** The court applied the definition of 'Operational Debt' to the facts of the case

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## Parties

- **Judges:** M.K. Sh…; Bhaskara Pantula…
- **Appellants:** M/s. Autostriping…
- **Respondents:** M/s. Encyclo…

## Timeline

- **2014-04-01 — Service Perio…**: The Debtor availed services…
- **2014-07-19 — Service Per…**: The Debtor availed services…

## 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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