# In the matter of Karnataka Agro Chemicals Pvt. Ltd. C.P. (IB)No. 173-BB-2020

> NCLT judgment dated 2021-03-08. Citation: TCN-2021-NCLT-02782. The case involves an application filed by Suraj Air (India) Pvt Ltd, the Operational Creditor,…

- **Court:** NCLT
- **Order date:** 8 Mar 2021
- **Citation:** TCN-2021-NCLT-02782
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/karnataka-agro-chemicals-pvt-ltd-cp-ibno-173-bb-2020-814650c6

## Summary

### Background

The case involves an application filed by Suraj Air (India) Pvt Ltd, the Operational Creditor, under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Karnataka Agro Chemicals Pvt Ltd, the Corporate Debtor, due to a default of Rs. 15,18,826/- including interest. The case was listed on multiple dates and adjourned at the request of the parties.

## Facts

Suraj Air (India) Pvt Ltd, the Operational Creditor, filed an application under Section 9 of the IBC, 2016, to initiate CIRP against Karnataka Agro Chemicals Pvt Ltd, the Corporate Debtor, due to a default of Rs. 15,18,826/- including interest at 12% p.a. The case was listed on multiple dates and adjourned. Both parties entered into a settlement where the Corporate Debtor agreed to settle Rs. 15,74,284/- in 8 installments from February 2021 to August 2021, and the Operational Creditor received 8 cheques. A Joint Memo was filed for withdrawal of the application, with the Operational Creditor agreeing to withdraw the application and both parties agreeing to the compromise and not to claim for the same cause of action in the future unless the entire amount is settled. The

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## Issues and analysis

### Issue 1: Whether the application filed under Section 9 of the IBC, 2016, should be disposed of as withdrawn …

**Ratio:** When parties enter into a settlement and file a Joint Memo for withdrawal of the

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**Reasoning:** The court considered the facts presented by the Proxy Counsel, perused the contents of

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**Interpretation:** The court interpreted the settlement agreement and the Joint Memo as a clear

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**Application:** Based on the settlement and the Joint Memo, the court disposed of the

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## Parties

- **Judges:** Rajeswara Rao…; Ashutosh C…
- **Appellants:** Suraj Air (India)…
- **Respondents:** Karnataka Agro…

## Timeline

- **2020-06-18 — Case Lis…**: The case was listed on…
- **2020-07-02 — Case Lis…**: The case was listed on…

## 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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