# In the matter of Ocean Tropical Fruits Pvt. Ltd. MA-174-2018 in CP-564-(IB)-CB-2017

> NCLT judgment dated 2019-05-28. Citation: TCN-2019-NCLT-03167. The case involves a dispute between M/s. PepsiCo India Holdings Pvt. Ltd. (Applicant) and M/s.…

- **Court:** NCLT
- **Order date:** 28 May 2019
- **Citation:** TCN-2019-NCLT-03167
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ocean-tropical-fruits-pvt-ltd-ma-174-2018-in-cp-564-ib-cb-2017-580f9ce7

## Summary

### Background

The case involves a dispute between M/s. PepsiCo India Holdings Pvt. Ltd. (Applicant) and M/s. Oceanic Tropical Fruits Pvt. Ltd. (Corporate Debtor) regarding the termination of a Manufacturing and Supply Agreement. PepsiCo sought directions to the Resolution Professional (RP) of Oceanic Tropical Fruits to handover certain Plant & Machinery owned by PepsiCo, which were located at the premises of the Corporate Debtor. The agreement, dated May 12, 2011, allowed Oceanic Tropical Fruits to manufacture, process, and package Slice RGB for PepsiCo. An addendum was added on April 27, 2016, to include Mirinda Cups. PepsiCo terminated the agreement on November 28, 2017, citing the initiation of Corporate Insolvency Resolution Process (CIRP) against Oceanic Tropical Fruits.

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## Facts

M/s. PepsiCo India Holdings Pvt. Ltd. (Applicant) and M/s. Oceanic Tropical Fruits Pvt. Ltd. (Corporate Debtor) entered into a Manufacturing and Supply Agreement on May 12, 2011, where the Corporate Debtor would manufacture, process, and package Slice RGB for the Applicant. An addendum was added on April 27, 2016, to include Mirinda Cups. The agreement was for a period of 10 years, till May 2021. The Applicant installed manufacturing lines and related equipment ("Assets") at the Corporate Debtor's premises for manufacturing the products. On September 13, 2017, Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor. The Applicant issued a termination notice dated November 28, 2017, to the Corporate Debtor, citing Clause

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## Issues and analysis

### Issue 1: Whether the termination of the agreement on 28.11.2017 by the Applicant under Clause 15.3(b) of the …

**Ratio:** Section 14 of the Insolvency and Bankruptcy Code, 2016 imposes a moratorium upon the

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**Reasoning:** The NCLT reasoned that allowing the Applicant to terminate the agreement and recover its

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**Interpretation:** Section 14 of the IBC is interpreted to mean that during the moratorium period,

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**Application:** In this case, the NCLT found that the Applicant's termination of the agreement

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## Parties

- **Judges:** Ch. Mohd Sharief…
- **Appellants:** M/s PepsiCo India…
- **Respondents:** M/s Oceanic…; V. Naga…
- **Advocates:** Mura…; Dhee…; +1 more

## Timeline

- **2011-05-12 — Manufacturing and…**: M/s. PepsiCo India Holdings Pvt. Ltd. and M/s. Oceanic Tropical Fruits Pvt. Ltd. entered…
- **2016-04-27 — Addendum Ag…**: An addendum to the Manufacturing and Supply Agreement was entered into, including Mirinda…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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