# In the matter of Seshasaila Power and Engineering Private Limited CP (IB) No. 246-9-HDB-2020

> NCLT judgment dated 2021-03-26. Citation: TCN-2021-NCLT-02545. The case involves a Company Application filed by M/s. Sri Lalitha Equipments (Operational…

- **Court:** NCLT
- **Order date:** 26 Mar 2021
- **Citation:** TCN-2021-NCLT-02545
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/seshasaila-power-and-engineering-private-limited-cp-ib-no-246-9-hdb-2020-629b1dee

## Summary

### Background

The case involves a Company Application filed by M/s. Sri Lalitha Equipments (Operational Creditor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP) against M/s. Seshasaila Power and Engineering (P) Limited (Corporate Debtor). The Operational Creditor claimed that the Corporate Debtor defaulted on payments for crane services provided as per an agreement.

## Facts

Sri Lalitha Equipments (Operational Creditor) is in the business of providing cranes on rent and hire. Seshasaila Power and Engineering (P) Limited (Corporate Debtor) entered into an agreement with the Operational Creditor for crane services at a rate of ₹3,25,000 per month with a minimum operating period. The agreement included terms for diesel consumption, lubes, accommodation, and mobilization charges. The Operational Creditor provided crane services and submitted bills, but some bills remained unpaid. The Operational Creditor sent multiple letters and emails for payment, but the Corporate Debtor delayed payments, citing financial difficulties. The outstanding default amount was ₹18,28,000 as of 31.03.2010, and the total sum including interest was ₹82,78,138.59 as

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## Issues and analysis

### Issue 1: Whether the Operational Creditor has proved that a default has occurred for which the Corporate …

**Ratio:** The Adjudicating Authority must be satisfied that a default has occurred based on the

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**Reasoning:** The Adjudicating Authority reviewed the agreement, invoices, ledger statements, and

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**Interpretation:** The IB Code requires the Adjudicating Authority to determine whether a default

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**Application:** The Adjudicating Authority found that the Operational Creditor had provided

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## Parties

- **Judges:** Madan B.…; BINOD KUMAR…
- **Appellants:** Lalitha Equ…
- **Respondents:** Seshasaila Power…

## Timeline

- **2020-10-26 — Corporate Debtor files…**: Mr. V. Subramanyam, Director of the Corporate Debtor, filed a counter/reply stating that…
- **2020-01-07 — Statutory Not…**: The Operational Creditor sent a statutory notice in Form-3, with copies of Invoices…

## 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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