# In the matter of Kumar Arch Tech Pvt. Ltd  C.P. (IB) No. 552-9-NCLT-AHM-2018

> NCLT judgment dated 2019-04-09. Citation: TCN-2019-NCLT-04040. The case involves a petition filed under Section 9 of the Insolvency and Bankruptcy Code (IBC).…

- **Court:** NCLT
- **Order date:** 9 Apr 2019
- **Citation:** TCN-2019-NCLT-04040
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/kumar-arch-tech-pvt-ltd-cp-ib-no-552-9-nclt-ahm-2018-116565fa

## Summary

### Background

The case involves a petition filed under Section 9 of the Insolvency and Bankruptcy Code (IBC). The petition, CP (IB) No. 552/9/NCLT/AHM/2018, was initially admitted on 29.03.2018. Subsequently, the corporate debtor approached the operational creditor and settled the outstanding amount. The operational creditor then filed an application to withdraw the petition based on the settlement.

## Facts

M/s. Vikas Ecotech Limited faced an insolvency petition filed by an operational creditor, Kumar Arch Tech Pvt. Ltd., under Section 9 of the IBC. The petition, CP (IB) No. 552/9/NCLT/AHM/2018, was admitted on March 29, 2018. After the admission, the corporate debtor settled the outstanding amount with the operational creditor through two demand drafts, leading to a settlement agreement executed on April 5, 2019. The operational creditor then filed an application to withdraw the insolvency petition. The IRP, Mr. Kiran C. Shah, was appointed but the Committee of Creditors (CoC) was not yet formed. The court noted that the corporate debtor had cleared the total outstanding amount during the intervening period after the petition was admitted. The court considered the

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## Issues and analysis

### Issue 1: Whether the operational creditor can withdraw the insolvency petition filed under Section 9 of the …

**Ratio:** The NCLT has the power to allow or disallow an application for withdrawal or settlement

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**Reasoning:** The court relied on the Supreme Court's observation that before a CoC is constituted, the

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**Interpretation:** This clarifies that the NCLT retains authority to decide on withdrawal

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**Application:** In this case, since the CoC was not yet constituted and the corporate debtor

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## Parties

- **Judges:** Manorama…
- **Respondents:** Vikas Ecotech…; Kumar Arch Tech…

## Timeline

- **2018-03-29 — Admission of…**: CP (IB) No. 552/9/NCLT/A…
- **2019-04-03 — Payment by Corporate…**: Corporate debtor paid the total outstanding amount to the operational creditor via two…

## 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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