# In the matter of Naresh Retail Mart LLP C. P. (IB) No. 223-KB-2016

> NCLT judgment dated 2019-10-22. Citation: TCN-2019-NCLT-00872. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 22 Oct 2019
- **Citation:** TCN-2019-NCLT-00872
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/naresh-retail-mart-llp-c-p-ib-no-223-kb-2016-a5669de4

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by M/s. J.D. (India) Corporation, an operational creditor, seeking initiation of the Corporate Insolvency Resolution Process (CIRP) against M/s. Naresh Retail Mart LLP, the corporate debtor. The operational creditor claimed that the corporate debtor had defaulted on payments for ready-made garments supplied since September 2017. The corporate debtor allegedly issued cheques amounting to Rs. 34,89,073/- which were dishonored due to insufficient funds. The operational creditor issued a demand notice under Section 8 of the Code on December 5, 2018, which was duly delivered on December 10, 2018, but the corporate debtor did not respond. The operational creditor also filed an

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## Facts

M/s. J.D. (India) Corporation, an operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. Naresh Retail Mart LLP, the corporate debtor. The operational creditor supplied ready-made garments to the corporate debtor since September 2017 and raised invoices for these supplies. The corporate debtor issued eight cheques amounting to Rs. 34,89,073/- to the operational creditor, but these cheques were dishonored due to insufficient funds. The operational creditor claimed that a sum of Rs. 37,69,893/- along with interest @ 18% p.a. amounting to Rs. 7,05,685/- was due till November 2018, totaling Rs. 44,75,578/-. A demand notice under Section 8 of the Code

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the Insolvency and …

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

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**Reasoning:** The court considered the documents submitted by the operational creditor and the fact

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**Interpretation:** Section 9 provides the mechanism for operational creditors to recover their

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**Application:** The court applied Section 9 to the facts, noting the dishonored cheques, the

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## Parties

- **Judges:** Jinan…; Harish Chander…
- **Appellants:** J.D. (INDIA)…
- **Respondents:** NARESH RETAIL…

## Timeline

- **2017-09-01 — Commencement of…**: The Operational Creditor started supplying…
- **2018-11-01 — Debt Calcu…**: The Operational Creditor calculated the outstanding debt, including interest, to be Rs.…

## 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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