# in the matter of Gammon India Pvt. Ltd. CP No. 507-2017

> NCLT judgment dated 2017-07-19. Citation: TCN-2017-NCLT-00721. Balaji Enterprises filed a Company Petition for initiation of Corporate Insolvency Resolution…

- **Court:** NCLT
- **Order date:** 19 Jul 2017
- **Citation:** TCN-2017-NCLT-00721
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/gammon-india-pvt-ltd-cp-no-507-2017-5a4f35a4

## Summary

### Background

Balaji Enterprises filed a Company Petition for initiation of Corporate Insolvency Resolution Process under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Gammon India Ltd., alleging default in payment for sub-contract work done at Ennore and hire charges for scaffolding materials at a construction site in Bangalore. The Operational Creditor claimed defaults on 29.11.2016 and 28.10.2015, relating to payments of Rs.65,80,536/- and Rs.93,72,026/-, respectively. The Corporate Debtor denied the liability, stating that the amount claimed had already been paid and the claim amount was incorrect.

## Facts

Balaji Enterprises (Operational Creditor) filed a petition against Gammon India Ltd. (Corporate Debtor) under Section 9 of the IBC, 2016, claiming default in payments. The claim consisted of two parts: Rs. 65,80,536/- for sub-contract work at Ennore (defaulted on 29.11.2016) and Rs. 93,72,026/- for hire charges of scaffolding materials at a Bangalore construction site (defaulted on 28.10.2015). The Ennore sub-contract was based on a work order dated 27.02.2010, with a value of Rs. 81,01,700/- and a Letter of Intent dated 28.09.2010, with an agreed price of Rs. 32,11,200/-. The Operational Creditor relied on an email dated 20.07.2013, stating an outstanding amount of Rs. 49,51,249.46. The Corporate Debtor made partial payments of Rs. 6,00,000/- on 06.11.2013 and Rs.

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## Issues and analysis

### Issue 1: Whether the Operational Creditor has established the existence of a debt owed by the Corporate …

**Ratio:** The existence of a debt is a prerequisite for initiating CIRP under Section 9 of the IBC.

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**Reasoning:** The court found that the Operational Creditor failed to produce invoices for the work

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**Interpretation:** The court interpreted the requirements for establishing a debt under the IBC,

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**Application:** The court applied the ratio to the facts of the case, finding that the

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## Parties

- **Judges:** B.S.V. Prakash…; V. Nallasen…
- **Appellants:** Balaji Ente…
- **Respondents:** Gammon Indi…

## Timeline

- **2010-02-27 — Work Order…**: Gammon India Ltd. issued Work Order No.8633/297 to Balaji Enterprises for sub-contract…
- **2010-09-28 — Letter of Inte…**: Gammon India Ltd. issued a Letter of Intent to Balaji Enterprises for sub-contract work…

## 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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