# In the matter of G.R.S. Ispat Company Pvt. Ltd. (IB)-2590 (ND) 2019

> NCLT judgment dated 2019-11-28. Citation: TCN-2019-NCLT-00405. The Operational Creditor, M/S SHIP YARD CO., filed a petition under Section 9 of the Insolvency…

- **Court:** NCLT
- **Order date:** 28 Nov 2019
- **Citation:** TCN-2019-NCLT-00405
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/grs-ispat-company-pvt-ltd-ib-2590-nd-2019-a3fc6241

## Summary

### Background

The Operational Creditor, M/S SHIP YARD CO., filed a petition under Section 9 of the Insolvency & Bankruptcy Code, 2016, against the Corporate Debtor, M/S G.R.S. ISPAT COMPANY (PVT.) LTD. The Operational Creditor is in the business of scrap materials, while the Corporate Debtor manufactures mile steel billts. The Corporate Debtor approached the Operational Creditor for the supply of TMT BAR CUTTINGS-HSN/SAC/ goods. The Operational Creditor supplied goods/material worth Rs. 2,09,86,645/- on 2018-03-31. The Corporate Debtor made a part payment of Rs. 4,00,000/- on 2018-12-27. Despite repeated requests, the Corporate Debtor failed to reduce the outstanding liability. The Operational Creditor served a demand notice dated 2019-08-12.

## Facts

M/S SHIP YARD CO., the Operational Creditor, is in the business of scrap materials. M/S G.R.S. ISPAT COMPANY (PVT.) LTD., the Corporate Debtor, manufactures mile steel billts. The Corporate Debtor approached the Operational Creditor for the supply of TMT BAR CUTTINGS-HSN/SAC/ goods. The Operational Creditor supplied goods/material worth Rs. 2,09,86,645/- to the Corporate Debtor on 2018-03-31. The Corporate Debtor made a part payment of Rs. 4,00,000/- on 2018-12-27. The Operational Creditor served a demand notice dated 2019-08-12 under Rule 5 of Insolvency and Bankruptcy Rules demanding the remaining outstanding amount of Rs. 2,05,86,645/-. The Corporate Debtor issued a letter dated 2019-08-21 acknowledging the debt and requested further time to make the payment due to

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## Issues and analysis

### Issue 1: Whether the petition filed by the Operational Creditor under Section 9 of the Insolvency & …

**Ratio:** The ratio is based on Section 9 of the Insolvency & Bankruptcy Code, 2016, which

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**Reasoning:** The Tribunal observed that the Corporate Debtor is liable to pay the amount claimed of

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**Interpretation:** Section 9 of the IBC allows an operational creditor to initiate CIRP when a

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**Application:** The Corporate Debtor acknowledged the debt and requested more time to make the

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## Parties

- **Judges:** Ina Mal…; SUMITAPURKA…
- **Appellants:** M/S SHIP YA…
- **Respondents:** M/S G.R.S. ISPAT…

## Timeline

- **2018-03-31 — Supply of…**: The Operational Creditor supplied goods/material worth Rs. 2,09,86,645/- to the Corporate…
- **2018-12-27 — Part Pay…**: The Corporate Debtor made a part payment 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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