# In the matter of RDG Interior Decoration Exterior Architecture Private Limited C.P. (IB) No. 1303-KB-2019

> NCLT judgment dated 2019-12-19. Citation: TCN-2019-NCLT-00074. Gagan Ferrotech Ltd. filed an application under Section 9 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 19 Dec 2019
- **Citation:** TCN-2019-NCLT-00074
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/rdg-interior-decoration-exterior-architecture-private-limited-cp-ib-no-1303-kb-2-dc265534

## Summary

### Background

Gagan Ferrotech Ltd. filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against RDG Interior Decoration Exterior Architecture Private Limited, claiming a default in payment of INR 7,69,415/-. The Corporate Debtor had placed orders for the purchase of TMT Bars, and the Operational Creditor supplied the goods and raised invoices. Despite issuing post-dated cheques, the cheques were dishonored due to insufficient balance. The Operational Creditor sent a demand notice, but the Corporate Debtor failed to make the payment.

## Facts

Gagan Ferrotech Ltd. (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against RDG Interior Decoration Exterior Architecture Private Limited (Corporate Debtor). The Corporate Debtor had placed orders for the purchase of TMT Bars, and the Operational Creditor supplied the goods, raising a tax invoice dated 24.10.2017 for Rs. 6,07,608/-. The Corporate Debtor issued two post-dated cheques towards payment, but both were dishonored due to insufficient balance. The Operational Creditor sent a demand notice dated 16.04.2019 under Form 3 of the Code, which was received by the Corporate Debtor on 20.04.2019. The amount due was Rs. 7,69,415/-, inclusive of principal

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the Insolvency and …

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

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**Reasoning:** The court considered the documents submitted by the Operational Creditor, including the

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**Interpretation:** Section 9 of the IBC provides a mechanism for operational creditors to recover

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**Application:** The court found that the Operational Creditor had demonstrated a default in

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## Parties

- **Judges:** Jinan…; Harish Chander…
- **Appellants:** Gagan Ferrotech…
- **Respondents:** RDG Interior…; RDG Interior…

## Timeline

- **2017-10-19 — Purchase…**: Corporate Debtor placed…
- **2017-10-24 — Tax Invo…**: Operational Creditor raised a…

## 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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