# In the matter of Malwa Cotton Spinning Mills Ltd. CP(IB) No. 318-Chd-Chd-2019

> NCLT judgment dated 2021-11-01. Citation: TCN-2021-NCLT-00646. The case pertains to CP(IB) No. 318/Chd/Chd/2019 under Section 9 of the IBC 2016. Mulakh Raj…

- **Court:** NCLT
- **Order date:** 1 Nov 2021
- **Citation:** TCN-2021-NCLT-00646
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/malwa-cotton-spinning-mills-ltd-cpib-no-318-chd-chd-2019-1118202f

## Summary

### Background

The case pertains to CP(IB) No. 318/Chd/Chd/2019 under Section 9 of the IBC 2016. Mulakh Raj Rajinder Kumar, the petitioner and operational creditor, filed a petition against Malwa Cotton Spinning Mills Ltd., the respondent and corporate debtor. The matter was presented through video conferencing.

## Facts

Mulakh Raj Rajinder Kumar, an operational creditor, filed a petition (CP(IB) No. 318/Chd/Chd/2019) under Section 9 of the Insolvency and Bankruptcy Code (IBC) 2016 against Malwa Cotton Spinning Mills Ltd., the corporate debtor. The petitioner's counsel submitted that the matter has been settled between the parties, and the corporate debtor has paid the entire amount due. As a result, the petitioner sought to withdraw the petition. The NCLT considered the submission and ordered the petition to be dismissed as withdrawn.

## Issues and analysis

### Issue 1: Whether the petition filed under Section 9 of the IBC 2016 should be dismissed as withdrawn, given …

**Ratio:** When a settlement is reached between the operational creditor and the corporate debtor,

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**Reasoning:** The court reasoned that since the matter has been settled between the parties and the

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**Interpretation:** This interpretation emphasizes the importance of facilitating settlements in

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**Application:** In this specific case, the petitioner-operational creditor confirmed that the

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## Parties

- **Judges:** SUBRATA KUM…; Harnam Singh…
- **Appellants:** Mulakh Raj…
- **Respondents:** Malwa Cotton…

## Timeline

- **2019-01-01 — Petition…**: CP(IB) No. 318/Chd/Chd/2019 filed…
- **2021-11-01 — Order…**: Petition dismissed as withdrawn due…

## 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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