# In the matter of Otto Projects Private Ltd. CP (IB) No. 1136-KB-2018

> NCLT judgment dated 2019-10-24. Citation: TCN-2019-NCLT-00828. M/s. Calcutta Trading Centre, the Operational Creditor, filed an application under Section 9 of…

- **Court:** NCLT
- **Order date:** 24 Oct 2019
- **Citation:** TCN-2019-NCLT-00828
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/otto-projects-private-ltd-cp-ib-no-1136-kb-2018-0d79d331

## Summary

### Background

M/s. Calcutta Trading Centre, the Operational Creditor, filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, against M/s. Otto Projects Private Limited, the Corporate Debtor, to initiate the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor allegedly defaulted in paying an operational debt of Rs. 4,80,680/-. The Operational Creditor claimed that between 2013 and 2017, they sold and supplied goods worth Rs. 12,40,725/- to the Corporate Debtor, out of which the Corporate Debtor paid Rs. 9,61,500/-, leaving a balance of Rs. 2,79,225/- plus interest. A demand notice under Section 8 of the I&B Code was served on 2018-03-10, but the Corporate Debtor neither replied nor made the payment. The Corporate Debtor did not appear

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## Facts

M/s. Calcutta Trading Centre (Operational Creditor) filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, against M/s. Otto Projects Private Limited (Corporate Debtor). The Operational Creditor claimed that the Corporate Debtor defaulted on an operational debt of Rs. 4,80,680/-. Between 2013 and 2017, the Operational Creditor sold and supplied goods worth Rs. 12,40,725/- to the Corporate Debtor. The Corporate Debtor paid Rs. 9,61,500/-, leaving a balance of Rs. 2,79,225/- plus interest. A demand notice under Section 8 of the I&B Code was served on 2018-03-10, but the Corporate Debtor did not reply or make payment. The Corporate Debtor did not appear in the CIRP proceedings. The Operational Creditor did not suggest a name for the IRP.

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## Issues and analysis

### Issue 1: Whether the application for initiation of Corporate Insolvency Resolution Process under Section 9 …

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

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

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

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**Application:** The court applied the ratio of Section 9 to the facts of the case, noting that

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Appellants:** M/s. Calcutta…
- **Respondents:** M/s. Otto…

## Timeline

- **2013-01-01 — Goods Sold and…**: Between 2013 and 2017, M/s. Calcutta Trading Centre sold and supplied goods to M/s. Otto…
- **2017-12-31 — Goods Sold and…**: Between 2013 and 2017, M/s. Calcutta Trading Centre sold and supplied goods to M/s. Otto…

## 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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