# In the matter of Navalmar Shipping (India) Private Limited C.P (IB) No. 324-BB-2019

> NCLT judgment dated 2020-05-29. Citation: TCN-2020-NCLT-01272. Navalmar (UK) Limited, an operational creditor, filed a company petition under Section 9 of the…

- **Court:** NCLT
- **Order date:** 29 May 2020
- **Citation:** TCN-2020-NCLT-01272
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/navalmar-shipping-india-private-limited-cp-ib-no-324-bb-2019-1f9d6330

## Summary

### Background

Navalmar (UK) Limited, an operational creditor, filed a company petition under Section 9 of the IBC, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Navalmar Shipping (India) Private Limited, the corporate debtor, due to a default of USD 17,35,645.46. The operational creditor claimed that the corporate debtor, acting as its representative in India from 2002 to 2018, failed to remit payments aggregating to USD 13,40,572.89 for freight charges and failed to make payments for motorboat purchases and repairs amounting to USD 1,41,072.57. Additionally, advances of USD 2,54,000.00 were made for services that were neither provided nor refunded. The corporate debtor contended that there was a pre-existing dispute regarding the amount of debt,

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## Facts

Navalmar (UK) Limited, the operational creditor, filed a petition against Navalmar Shipping (India) Private Limited, the corporate debtor, under Section 9 of the IBC, 2016, claiming a default of USD 17,35,645.46. The operational creditor alleged that the corporate debtor, acting as its representative in India, failed to remit payments for freight charges (USD 13,40,572.89), motorboat purchases and repairs (USD 1,41,072.57), and advances for services (USD 2,54,000.00). The corporate debtor contested the claim, asserting a pre-existing dispute, inflated claims, and the absence of insolvency. The corporate debtor argued that the operational creditor's claim was false and frivolous, and the condition of insolvency did not exist. The corporate debtor also contended that the

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## Issues and analysis

### Issue 1: Whether there exists a pre-existing dispute between the Operational Creditor and the Corporate …

**Ratio:** The existence of a genuine pre-existing dispute is a bar to the admission of an

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**Reasoning:** The court found that the Corporate Debtor did not have a valid or bonafide pre-existing

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**Interpretation:** A 'dispute' under the IBC must be a genuine and bona fide dispute, not a mere

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**Application:** In this case, the Corporate Debtor's contention that the amounts claimed by the

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## Parties

- **Judges:** Rajeswara Rao…; Ashutosh C…
- **Appellants:** Navalmar (UK)…
- **Respondents:** Navalmar Shipping…

## Timeline

- **2019-07-15 — Board Reso…**: Board Resolution passed by the Operational Creditor Company authorizing Mr. Andrea…
- **2019-07-16 — Power of At…**: Power of Attorney dated…

## 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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