# In the matter of Raunak Mercantile and Trading Pvt. Ltd. C.P. No. 2788-I&BP-2019

> NCLT judgment dated 2019-10-14. Citation: TCN-2019-NCLT-01003. Katyayan Mercantile and Trading Pvt. Ltd. filed a company petition under Section 8 and 9 of the…

- **Court:** NCLT
- **Order date:** 14 Oct 2019
- **Citation:** TCN-2019-NCLT-01003
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/raunak-mercantile-and-trading-pvt-ltd-cp-no-2788-ibp-2019-9fb5c67e

## Summary

### Background

Katyayan Mercantile and Trading Pvt. Ltd. filed a company petition under Section 8 and 9 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Raunak Mercantile & Trading Pvt. Ltd. The petitioner alleged that the corporate debtor defaulted on 16.04.2019 in making payment of Rs. 36,96,46,480/- including interest @5% p.a. The petition was filed due to the corporate debtor's failure to pay for books supplied by the petitioner based on purchase orders placed on 11.02.2019. The petitioner delivered the goods between 01.03.2019 and 31.03.2019, raising 20 invoices amounting to Rs. 36,61,73,900/-.

## Facts

On 11.02.2019, Raunak Mercantile & Trading Pvt. Ltd. (Corporate Debtor) approached Katyayan Mercantile and Trading Pvt. Ltd. (Petitioner) and placed orders for the supply of books. The Petitioner supplied the books between 01.03.2019 and 31.03.2019 and raised 20 invoices amounting to Rs. 36,61,73,900/-. The Corporate Debtor confirmed an outstanding balance of Rs. 51,20,33,900/- as on 31.03.2019. On 10.04.2019, the Petitioner demanded an outstanding due of Rs. 51,20,33,900/-. The Corporate Debtor made a part-payment of Rs. 14,58,60,000/- till 30.04.2019. The balance amount of Rs. 36,70,88,279/- (including interest @5% p.a.) remained due. On 21.06.2019, the Petitioner issued a Demand Notice for Rs. 36,96,46,480/- (including interest @5% p.a.). On 01.07.2019, the

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor defaulted in …

**Ratio:** Section 8 and 9 of the Insolvency and Bankruptcy Code (IBC) allows an operational

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**Reasoning:** The Corporate Debtor admitted to the liability in its reply dated 01.07.2019 but cited

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**Interpretation:** The IBC defines default as non-payment of debt when due and payable. The

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**Application:** The Corporate Debtor admitted to owing Rs. 36,96,46,480/- to the Petitioner and

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## Parties

- **Judges:** SUCHITRAKAN…; V. Nallasen…
- **Appellants:** Katyayan Mercantil…
- **Respondents:** Raunak Mercantile…
- **Advocates:** Bindu B…

## Timeline

- **2019-02-11 — Purchase Order…**: Corporate Debtor placed…
- **2019-03-01 — Supply of…**: Petitioner supplied books to the Corporate…

## 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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