# In the matter of Fab Auto Parts Private Limited CP No. 350-IBC-NCLT-MB-MAH-2018

> NCLT judgment dated 2018-08-20. Citation: TCN-2018-NCLT-00925. The case involves an application filed by Mr. Harshad Vandradas Vora, an Operational Creditor,…

- **Court:** NCLT
- **Order date:** 20 Aug 2018
- **Citation:** TCN-2018-NCLT-00925
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/fab-auto-parts-private-limited-cp-no-350-ibc-nclt-mb-mah-2018-59e27ac0

## Summary

### Background

The case involves an application filed by Mr. Harshad Vandradas Vora, an Operational Creditor, against M/s. Fab Auto Parts Private Limited, the Corporate Debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016, for initiation of the Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed that the Corporate Debtor defaulted on payments for steel coils supplied between 14.02.2013 and 23.02.2013. Despite part-payments, a significant amount remained outstanding. The Operational Creditor issued a demand notice under Section 8 of the Code on 27.10.2017, which was received by the Corporate Debtor, but no reply or further payment was made.

## Facts

Mr. Harshad Vandradas Vora, operating as M/s. Utakrsh Steel Corporation, supplied HR Steel Coils to M/s. Fab Auto Parts Private Limited between 14.02.2013 and 23.02.2013. Invoices totaling ₹13,67,016/- were raised for these supplies. The Corporate Debtor made part-payments totaling ₹3,20,000/- between 01.04.2015 and 25.08.2016. As of the date of the application, the total amount in default was ₹26,21,868/-, including a principal amount of ₹10,47,016/- and interest of ₹15,74,852/- at 30% p.a. A demand notice under Section 8 of the IBC was issued on 27.10.2017 and received by the Corporate Debtor, but no reply or further payment was made. The Corporate Debtor also failed to appear before the NCLT despite receiving notice of the hearing. The Operational Creditor filed

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## Issues and analysis

### Issue 1: Whether the Operational Creditor's application under Section 9 of the Insolvency and Bankruptcy …

**Ratio:** The ratio is that if the Operational Creditor has demonstrated the existence of an

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**Reasoning:** The court reasoned that the Operational Creditor had supplied goods, raised valid

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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 demonstrated the existence of an

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## Parties

- **Judges:** M.K. Sh…
- **Appellants:** Harshad Vandradas…
- **Respondents:** M/s. Fab Auto…

## Timeline

- **2013-02-14 — Supply of Steel Coils…**: Operational Creditor starts supplying…
- **2013-02-23 — Supply of Steel Coils…**: Operational Creditor completes the supply…

## 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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