# In the matter of Fernas Construction India Pvt. Ltd. CP-IB-158-ND-2018

> NCLT judgment dated 2018-07-09. Citation: TCN-2018-NCLT-01178. The case involves an application filed by RVR Projects Pvt. Ltd. against Fernas Construction…

- **Court:** NCLT
- **Order date:** 9 Jul 2018
- **Citation:** TCN-2018-NCLT-01178
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/fernas-construction-india-pvt-ltd-cp-ib-158-nd-2018-9ce934c7

## Summary

### Background

The case involves an application filed by RVR Projects Pvt. Ltd. against Fernas Construction India Pvt. Ltd. under Section 9 of the Insolvency and Bankruptcy Code, 2016, alleging default in payment for services rendered. RVR Projects was contracted by Fernas Construction for piling works for a petrochemical complex in Dahej, Gujarat. Disputes arose when Fernas Construction allegedly foreclosed work orders and made piecemeal payments, leaving a significant balance unpaid. RVR Projects issued a demand notice, which Fernas Construction contested, leading to the insolvency petition.

## Facts

RVR Projects Pvt. Ltd. (Applicant/Operational Creditor) filed an application against Fernas Construction India Pvt. Ltd. (Respondent/Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016. Fernas Construction engaged RVR Projects for piling works at a petrochemical complex in Dahej, Gujarat, with an initial work order of Rs. 10,25,10,275/- dated 2011-08-04. RVR Projects executed the work and raised invoices, but Fernas Construction made payments in piecemeal. On 2012-05-09, Fernas Construction foreclosed the works, paying only Rs. 3,67,27,396 against a total bill of Rs. 4,22,20,877. Subsequently, Fernas Construction issued another work order for Rs. 2,05,02,500, which was also foreclosed midway. The total amount due as of the foreclosure date was

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the …

**Ratio:** The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 introduced Section 238A,

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**Reasoning:** The court reasoned that since the right to apply under Section 9 of the IBC accrued to

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**Interpretation:** The interpretation of Section 238A of the IBC, along with the Limitation Act,

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**Application:** In this case, the application was filed within three years of 2016-12-01.

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## Parties

- **Judges:** R. VARADH…; V.K. SUB…
- **Appellants:** RVR Projects Pvt.…
- **Respondents:** Fernas Constructio…

## Timeline

- **2011-08-04 — First Work…**: Fernas Construction issued the first work…
- **2012-05-09 — Work Forec…**: Fernas Construction foreclosed the works and paid Rs. 3,67,27,396 against a total bill of…

## 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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