# In the matter of Rainbow Papers Ltd. CP No. 88-9-NCLT-AHM-2017

> NCLT judgment dated 2017-09-12. Citation: TCN-2017-NCLT-00425. Neeraj Paper Agencies Ltd., the operational creditor, filed an application under Section 9 of…

- **Court:** NCLT
- **Order date:** 12 Sept 2017
- **Citation:** TCN-2017-NCLT-00425
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/rainbow-papers-ltd-cp-no-88-9-nclt-ahm-2017-8c2bd867

## Summary

### Background

Neeraj Paper Agencies Ltd., the operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Rainbow Papers Limited, the corporate debtor. The application was based on unpaid invoices for waste paper supplied by Neeraj Paper Agencies to Rainbow Papers. The applicant claimed that Rainbow Papers failed to pay an amount of Rs. 1,26,26,479, including interest, under various invoices.

## Facts

Neeraj Paper Agencies Ltd. (Operational Creditor) supplied waste paper to Rainbow Papers Ltd. (Corporate Debtor). The Corporate Debtor failed to pay an amount of Rs. 1,26,26,479 under various invoices, including interest at 2% per month. The Operational Creditor issued a demand notice dated 3rd March, 2017, to the Corporate Debtor, who replied admitting the debt by letter dated 27th March, 2017. The Operational Creditor filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against the Corporate Debtor. The Corporate Debtor raised several objections, including the validity of the demand notice, the absence of a certificate from a financial institution, disputes regarding the quality of goods supplied, and the authorization of

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## Issues and analysis

### Issue 1: Whether the demand notice issued to the Respondent was valid, considering it was signed by an …

**Ratio:** An 'Advocate/Lawyer' or 'Chartered Accountant' or 'Company Secretary' in absence of any

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**Reasoning:** The Hon'ble National Company Law Appellate Tribunal held that in the absence of any

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**Interpretation:** The interpretation of Section 8 of the I&B Code requires that the demand

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**Application:** In this case, the Applicant filed a Resolution authorizing J. Sagar Associates

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## Parties

- **Judges:** BIKKI RAVEENDRA…
- **Appellants:** Neeraj Paper…
- **Respondents:** Rainbow Papers…

## Timeline

- **2017-03-03 — Demand Notice…**: Applicant issued Demand Notice dated 3rd…
- **2017-03-27 — Reply to Deman…**: Corporate Debtor gave reply admitting 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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