# In the matter of R. S. Motors Private Limited Company Petition No. (IB)-156-JPR-2019

> NCLT judgment dated 2019-09-30. Citation: TCN-2019-NCLT-01182. The case involves an application filed by M/s. Toyota Kirloskar Motor Private Limited…

- **Court:** NCLT
- **Order date:** 30 Sept 2019
- **Citation:** TCN-2019-NCLT-01182
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/r-s-motors-private-limited-company-petition-no-ib-156-jpr-2019-848f3d2b

## Summary

### Background

The case involves an application filed by M/s. Toyota Kirloskar Motor Private Limited ('Applicant'), an Operational Creditor, under Section 9 of the Insolvency and Bankruptcy Code, 2016 ('IBC, 2016') read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, seeking initiation of Corporate Insolvency Resolution Process ('CIRP') against M/s. R.S. Motors Private Limited ('Corporate Debtor'). The Operational Creditor claimed that the Corporate Debtor defaulted in paying an amount of Rs. 3,44,39,048/- for invoices raised for spare parts of vehicles supplied to the Corporate Debtor. The Corporate Debtor had dealership agreements with the Operational Creditor, and the default occurred for invoices generated in June and July 2016.

## Facts

M/s. Toyota Kirloskar Motor Private Limited, the Operational Creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. R.S. Motors Private Limited, the Corporate Debtor. The claim was for Rs. 3,44,39,048/- due to unpaid invoices for spare parts supplied by the Operational Creditor to the Corporate Debtor. The Corporate Debtor operated dealership facilities under the name 'CHANDRA TOYOTA' at various locations. The Operational Creditor had an online software system for e-purchase orders. The default occurred for invoices generated in June and July 2016, with due dates in July and August 2016, respectively. The Operational Creditor issued a Section 8 notice, which was

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016, for initiation …

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

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**Reasoning:** The Tribunal noted that the Operational Creditor had filed the application under Section

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

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

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## Parties

- **Judges:** POONDLA BHASKARA…; RAGHU N…; +1 more
- **Appellants:** M/s. Toyota…
- **Respondents:** M/s. R.S. Motors…

## Timeline

- **2019-08-28 — Ex-parte Pro…**: Tribunal proceeded ex-parte against the…
- **2019-09-20 — Order Res…**: Submissions of learned counsel for the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 8 — Insolvency resolution by operational creditor](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-8)

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