# In the matter of Galaxy Cosmetics Pvt. Ltd. CP-600-(IB)-2018

> NCLT judgment dated 2018-08-30. Citation: TCN-2018-NCLT-00853. The case involves an application filed by Nikita Containers Pvt Ltd, the Operational Creditor,…

- **Court:** NCLT
- **Order date:** 30 Aug 2018
- **Citation:** TCN-2018-NCLT-00853
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/galaxy-cosmetics-pvt-ltd-cp-600-ib-2018-16fdf622

## Summary

### Background

The case involves an application filed by Nikita Containers Pvt Ltd, the Operational Creditor, against Galaxy Cosmetics Private Limited, the Corporate Debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016, read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. The Operational Creditor sought to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor for an outstanding debt. The Corporate Debtor was proceeded ex-parte due to lack of representation.

## Facts

Nikita Containers Pvt Ltd (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Galaxy Cosmetics Private Limited (Corporate Debtor) for an outstanding debt of Rs. 6,88,958.47, inclusive of interest, as of 02.01.2018. The Operational Creditor is in the business of manufacturing and supplying Printed Tin Containers. The Corporate Debtor had a business relationship with the Operational Creditor, placing orders for Printed Tin Containers. The Operational Creditor duly supplied the requirements of the Corporate Debtor during April and June 2015. The Corporate Debtor admitted the liability in a communication dated 11.08.2015, requesting time to make payments. A cheque issued by the Corporate Debtor on 13.02.2017

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016, should be …

**Ratio:** Section 9 of the Insolvency and Bankruptcy Code, 2016, allows an operational creditor to

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**Reasoning:** The court was satisfied that the Corporate Debtor had committed a default in making

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**Interpretation:** Section 9 provides the mechanism for operational creditors to trigger the

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**Application:** The court applied Section 9 to the facts of the case, noting that the

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## Parties

- **Judges:** Ch. Mohd Sharief…
- **Appellants:** NIKITA CONTAINERS…
- **Respondents:** Galaxy Cosmetics…; GALAXY COSMETICS…

## Timeline

- **2015-04-01 — Supply of…**: Operational Creditor supplied goods to…
- **2015-08-11 — Admission of L…**: Corporate Debtor admitted liability…

## 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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