# In the matter of Madhushree Industries Pvt. Ltd. C.P. (IB) No. 1699-KB-2019

> NCLT judgment dated 2021-08-13. Citation: TCN-2021-NCLT-01339. The case involves an application filed by The Mining Industrial Corporation (Operational…

- **Court:** NCLT
- **Order date:** 13 Aug 2021
- **Citation:** TCN-2021-NCLT-01339
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/madhushree-industries-pvt-ltd-cp-ib-no-1699-kb-2019-562d1966

## Summary

### Background

The case involves an application filed by The Mining Industrial Corporation (Operational Creditor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Madhushree Industries Pvt. Ltd. (Corporate Debtor) for initiating the Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed that the Corporate Debtor failed to pay an outstanding debt of Rs. 21,89,769.54 for supplying coal. The Corporate Debtor acknowledged the debt but cited financial difficulties as the reason for non-payment. The Operational Creditor argued that the Corporate Debtor had not raised any disputes regarding the debt and had confirmed the books of accounts from time to time.

## Facts

The Mining Industrial Corporation (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Madhushree Industries Pvt. Ltd. (Corporate Debtor). The Operational Creditor supplied coal to the Corporate Debtor. The Corporate Debtor made partial payments but failed to clear all invoices, resulting in an outstanding debt of Rs. 21,89,769.54, including interest calculated at 24% until 31.07.2019. The Operational Creditor sent a demand notice dated 9th August 2019, which was delivered on 14th August 2019. The Corporate Debtor did not reply to the demand notice or raise any disputes regarding the debt. The Corporate Debtor acknowledged the debt but claimed financial difficulties and requested more time to repay. The

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016, is …

**Ratio:** Section 9 of the Insolvency and Bankruptcy Code, 2016, allows an operational creditor to

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**Reasoning:** The court reasoned that the Operational Creditor had provided sufficient evidence to

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**Interpretation:** Section 9 of the IBC is interpreted to mean that if an operational debt exists,

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**Application:** The Operational Creditor demonstrated that the Corporate Debtor owed a debt of

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## Parties

- **Judges:** Rajasekha…; Harish Chander…
- **Appellants:** The Mining…
- **Respondents:** Madhushree…

## Timeline

- **2019-08-09 — Demand Noti…**: The Operational Creditor sent a…
- **2019-08-14 — Demand Notice…**: The Demand Notice was delivered to the…

## 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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