# In the matter of Hansraj Agrofresh Private Limited RST A No. 1-2021 in C.P. No. (IB) 40-ALD-2019

> NCLT judgment dated 2021-11-29. Citation: TCN-2021-NCLT-00365. The case involves an application under Section 60(5) of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 29 Nov 2021
- **Citation:** TCN-2021-NCLT-00365
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/hansraj-agrofresh-private-limited-rst-a-no-1-2021-in-cp-no-ib-40-ald-2019-e69997fd

## Summary

### Background

The case involves an application under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, filed by Magpet Polymer Private Limited (Operational Creditor) against Hansraj Agrofresh Private Limited (Corporate Debtor). The Operational Creditor sought initiation of insolvency proceedings against the Corporate Debtor. A settlement agreement was entered into on February 8, 2020, after the admission of the Corporate Debtor into CIRP on February 6, 2020. This settlement agreement was breached, but contained a clause for revival of the main CP. An application under Section 12A was filed, and the Authority set aside the admission order of the Corporate Debtor into CIRP on February 27, 2020.

## Facts

Magpet Polymer Private Limited, the Operational Creditor, filed an application to initiate insolvency proceedings against Hansraj Agrofresh Private Limited, the Corporate Debtor. A settlement agreement was reached on February 8, 2020, after the Corporate Debtor was admitted into CIRP on February 6, 2020. This agreement required the Corporate Debtor to pay ₹54,74,000/- to the Operational Creditor. An application under Section 12A was filed, and the admission order of the Corporate Debtor into CIRP was set aside on February 27, 2020. Subsequently, the cheques given by the Corporate Debtor were dishonored. As of the hearing, ₹44,74,000/- remained outstanding. Clause 6 of the settlement agreement provided for the revival of proceedings if the agreement was breached. The

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## Issues and analysis

### Issue 1: Whether the application for revival of the Corporate Insolvency Resolution Process (CIRP) should be …

**Ratio:** The legal principle applied is that if a settlement agreement, entered into after the

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**Reasoning:** The court reasoned that the settlement agreement was not fully executed, with a

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**Interpretation:** The interpretation of the settlement agreement, specifically Clause 6, is

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**Application:** In this specific case, the breach of the settlement agreement, coupled with the

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## Parties

- **Judges:** Rajasekha…; Virendra Kumar…
- **Appellants:** Magpet Polymers…
- **Respondents:** Hansraj Agrofresh…

## Timeline

- **2020-02-06 — Admission in…**: Corporate Debtor…
- **2020-02-08 — Settlement Ag…**: Settlement agreement…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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