# In the matter of Saffron Poly Threads Private Limited CP (IB) No. 185-9-NCLT-AHM-2019

> NCLT judgment dated 2021-03-17. Citation: TCN-2021-NCLT-02664. The case involves an application filed by APL Corporation Pvt Ltd, the Operational Creditor,…

- **Court:** NCLT
- **Order date:** 17 Mar 2021
- **Citation:** TCN-2021-NCLT-02664
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/saffron-poly-threads-private-limited-cp-ib-no-185-9-nclt-ahm-2019-437c8f5d

## Summary

### Background

The case involves an application filed by APL Corporation Pvt Ltd, the Operational Creditor, under Section 9 of the Insolvency & Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Saffron Poly Threads Private Limited, the Corporate Debtor. The Operational Creditor claimed an amount of Rs. 14,06,131/- plus interest for goods supplied to the Corporate Debtor. The Corporate Debtor argued that there was a pre-existing dispute regarding the quality of goods supplied and that the claims were time-barred.

## Facts

APL Corporation Pvt Ltd, the Operational Creditor, filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Saffron Poly Threads Private Limited, the Corporate Debtor. The claim was for Rs. 14,06,131/- plus interest for goods supplied. The Corporate Debtor argued a pre-existing dispute over the quality of goods and that the claims were time-barred. The Operational Creditor supplied goods to the Corporate Debtor, raising invoices. The Corporate Debtor did not pay the outstanding dues, leading to a demand notice under Section 8 of IBC, 2016. The Corporate Debtor replied, citing a pre-existing dispute over inferior quality. The Operational Creditor argued regular transactions and

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the …

**Ratio:** An application under Section 9 of IBC, 2016 can be admitted provided there is a debt

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**Reasoning:** The court considered the fact and legal position that when there is a debt which is due

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**Interpretation:** Section 9 of the IBC allows an operational creditor to initiate CIRP against a

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**Application:** The court determined that there was no pre-existing dispute as far as supplies

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Appellants:** APL Corporation…
- **Respondents:** Saffron Poly…

## Timeline

- **2018-12-10 — Demand N…**: Operational Creditor issued Demand Notice under Section 8 of IBC, 2016 to the Corporate…
- **2021-03-09 — Order Res…**: Order Reserved on:…

## 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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