# In the matter of Kerala Communicators Cable Limited C.P. (IB)No. 153-BB-2020

> NCLT judgment dated 2020-08-17. Citation: TCN-2020-NCLT-00841. The case involves a petition filed by M/s. Siti Networks Limited ('Petitioner/Operational…

- **Court:** NCLT
- **Order date:** 17 Aug 2020
- **Citation:** TCN-2020-NCLT-00841
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/kerala-communicators-cable-limited-cp-ibno-153-bb-2020-0c10851b

## Summary

### Background

The case involves a petition filed by M/s. Siti Networks Limited ('Petitioner/Operational Creditor') under Section 9 of the IBC, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Kerala Communicators Cable Limited. The basis for the petition is the alleged default in payment of Rs. 10,09,493/- as of 31.12.2019, including interest, arising from a Channel Placement Agreement between the parties. Siti Networks, a Multi System Operator, had agreed to place Kerala Vision, a channel owned by Kerala Communicators, on its network. The agreement stipulated a placement fee of Rs. 7,00,000/- per annum plus taxes. After the initial agreement expired, it was extended for two months, and invoices were raised. Despite availing the services, Kerala

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## Facts

M/s. Siti Networks Limited (Operational Creditor) filed a petition under Section 9 of the IBC, 2016, against M/s. Kerala Communicators Cable Limited (Corporate Debtor) due to a default in payment. Siti Networks, a Multi System Operator, and Kerala Communicators, a cable channel provider, entered into a Channel Placement Agreement where Siti Networks would place Kerala Communicators' channel 'Kerala Vision' on its network. The agreement, initially from October 19, 2018, to October 18, 2019, stipulated a placement fee of Rs. 7,00,000/- per annum plus taxes. After the agreement's expiry, it was extended for two months upon the Corporate Debtor's request. Siti Networks raised invoices for the services, which Kerala Communicators allegedly failed to pay. Despite repeated

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## Issues and analysis

### Issue 1: Whether the petition filed by the Operational Creditor under Section 9 of the IBC, 2016, should be …

**Ratio:** The initiation of CIRP under Section 9 of the IBC, 2016, requires the existence of a debt

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**Reasoning:** The court considered the submissions of both parties and noted that the Corporate Debtor

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**Interpretation:** Section 9 of the IBC, 2016, provides a mechanism for Operational Creditors to

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**Application:** In this case, the court, considering the Corporate Debtor's willingness to

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## Parties

- **Judges:** Rajeswara Rao…; Ashutosh C…
- **Appellants:** Siti Networks…
- **Respondents:** Kerala Communicato…

## Timeline

- **2018-10-19 — Channel Placement…**: Channel Placement Agreement between Siti Networks and Kerala Communicators Cable Limited…
- **2019-10-18 — Channel Placement…**: Initial term of the Channel Placement Agreement between Siti Networks and Kerala…

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