# In the matter of Fab Pharmaceuticals Private Limited I. A. No. 139 of 2020 in C.P. (IB) No. 155-BB-2019

> NCLT judgment dated 2020-05-13. Citation: TCN-2020-NCLT-01364. The case originates from a petition filed by M/s. Origin Formulations Private Limited under…

- **Court:** NCLT
- **Order date:** 13 May 2020
- **Citation:** TCN-2020-NCLT-01364
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/fab-pharmaceuticals-private-limited-i-a-no-139-of-2020-in-cp-ib-no-155-bb-2019-0198b0e2

## Summary

### Background

The case originates from a petition filed by M/s. Origin Formulations Private Limited under Section 9 of the IBC, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Fab Pharmaceuticals Private Limited (Corporate Debtor) due to a default of Rs. 21,93,392. The Adjudicating Authority admitted the case on September 19, 2019, initiating CIRP and appointing S. Shivaswamy as the Interim Resolution Professional (IRP). Public announcement was made, inviting creditors to submit their claims. HDFC Bank (Financial Creditor) and the Commercial Tax Department submitted claims. A Committee of Creditors (COC) was formed with HDFC as the sole financial creditor. The COC conducted meetings where the continuation of CIRP was discussed. Subsequently,

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## Facts

M/s. Origin Formulations Private Limited filed a petition under Section 9 of the IBC, 2016, to initiate CIRP against M/s. Fab Pharmaceuticals Private Limited (Corporate Debtor) due to a default of Rs. 21,93,392. The Adjudicating Authority admitted the case on September 19, 2019, initiating CIRP and appointing S. Shivaswamy as the Interim Resolution Professional (IRP). Public announcement was made, inviting creditors to submit their claims. HDFC Bank (Financial Creditor) and the Commercial Tax Department submitted claims. A Committee of Creditors (COC) was formed with HDFC as the sole financial creditor. The COC conducted meetings where the continuation of CIRP was discussed. The Bank declared that the account of the Corporate Debtor was regular. The Corporate Debtor

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## Issues and analysis

### Issue 1: Whether the CIRP proceedings initiated against the Corporate Debtor should be terminated given the …

**Ratio:** The legal principle applied here is that the CIRP should serve the purpose of resolving

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**Reasoning:** The court reasoned that the Operational Creditor was not interested in availing the

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**Interpretation:** This issue involves the interpretation of the objectives of the IBC, 2016,

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**Application:** The ratio and reasoning were applied to the specific facts of the case, where

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## Parties

- **Judges:** Rajeswara Rao…
- **Appellants:** M/s Origin…
- **Respondents:** M/s. Fab Pharmaceu…; M/s Fab Pharmaceut…
- **Advocates:** Amiraj R…; Praveen Kum…; +2 more

## Timeline

- **2019-09-19 — Admission o…**: The Adjudicating Authority admitted the case, initiating CIRP and appointing S.…
- **2019-10-02 — Public Annou…**: The Interim Resolution Professional (IRP) caused Public Announcement(Form A) in Financial…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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