# In the matter of Four Pillars Event Management Services Private Limited CP (IB) No.3685-MB.IV-2018

> NCLT judgment dated 2020-09-18. Citation: TCN-2020-NCLT-00583. The case originates from a Company Petition filed under Section 9 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 18 Sept 2020
- **Citation:** TCN-2020-NCLT-00583
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/four-pillars-event-management-services-private-limited-cp-ib-no3685-mbiv-2018-8515d557

## Summary

### Background

The case originates from a Company Petition filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) by Novex Communications Private Limited (Operational Creditor) against Four Pillars Event Management Services Private Limited (Corporate Debtor). The Operational Creditor sought to initiate Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor due to unpaid dues. The Operational Creditor claimed that the Corporate Debtor failed to make payment of ₹3,00,000.00 as principal and ₹23,474.00 as interest as on 20.03.2018, which was stated to be the date of default.

## Facts

Novex Communications Private Limited (Operational Creditor) filed a petition against Four Pillars Event Management Services Private Limited (Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Operational Creditor claimed to be the assignee of copyrights over certain sound recordings and had agreements with Zee Entertainment Enterprises, Eros International Media Limited, Shemaroo Entertainment Limited, and Tips Industries Limited. The Corporate Debtor, an event management company, approached the Operational Creditor for on-Ground Performance Rights for an event called “Da Bangg The Tour Pune” held on 24.03.2018. The Operational Creditor raised a proforma invoice dated 20.03.2018 for ₹3,00,000/- for non-exclusive public performance rights.

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## Issues and analysis

### Issue 1: Whether the claim of the Operational Creditor qualifies as an 'Operational Debt' under Section …

**Ratio:** Section 5(21) of the IBC defines an “Operational Debt” as a claim in respect of the

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**Reasoning:** The NCLT reasoned that the existence of a jural relationship between the Operational

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**Interpretation:** The interpretation of 'Operational Debt' under Section 5(21) of the IBC

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**Application:** The NCLT applied the ratio to the facts by determining that the claim did not

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## Parties

- **Judges:** Rajasekha…; RavikumarDu…
- **Appellants:** Novex Communicatio…
- **Respondents:** Four Pillars…

## Timeline

- **2017-03-06 — Incorporation of…**: Four Pillars Event Management Services Private Limited incorporated under the Companies…
- **2018-03-20 — Proforma I…**: Operational Creditor raised a proforma invoice…

## 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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