# In the matter of Smartron India Private Limited IA No. 1164-2019 in CP (IB) No. 55-9-HDB-2019

> NCLT judgment dated 2019-12-20. Citation: TCN-2019-NCLT-00042. The case involves an application filed by the Operational Creditor, ZTE Corporation, under…

- **Court:** NCLT
- **Order date:** 20 Dec 2019
- **Citation:** TCN-2019-NCLT-00042
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/smartron-india-private-limited-ia-no-1164-2019-in-cp-ib-no-55-9-hdb-2019-714324d1

## Summary

### Background

The case involves an application filed by the Operational Creditor, ZTE Corporation, under Section 12A of the Insolvency and Bankruptcy Code (IBC), 2016, seeking permission to withdraw a Company Petition (CP(IB)No.55/9/HDB/2019). The Tribunal had previously admitted a petition under Section 9 of the IBC filed by the Operational Creditor, initiating the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, Smartron India Private Limited, and appointed an Interim Resolution Professional (IRP). During the pendency of the CIRP, both parties reached a settlement agreement dated 2019-12-10.

## Facts

ZTE Corporation, the Operational Creditor, initiated Corporate Insolvency Resolution Process (CIRP) against Smartron India Private Limited, the Corporate Debtor, under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016. The Tribunal admitted the petition and appointed an Interim Resolution Professional (IRP). During the CIRP, ZTE Corporation and Smartron India Private Limited reached a settlement agreement dated 2019-12-10. As part of the settlement, Smartron India Private Limited paid USD 600,000 to ZTE Corporation via six wire transfers between 2019-10-21 and 2019-12-06. The settlement agreement also included a personal guarantee from Mr. Mahesh Lingareddy, Chairman and Managing Director of Smartron India Private Limited, to pay the remaining USD 650,000 by

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## Issues and analysis

### Issue 1: Whether the Tribunal can allow the withdrawal of the Corporate Insolvency Resolution Process (CIRP) …

**Ratio:** Section 12A of the I&B Code, read with Regulation 30A of the IBBI (Insolvency

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**Reasoning:** The Tribunal reasoned that it has the power under Section 12A of the I&B Code to

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**Interpretation:** Section 12A provides a mechanism for parties to settle disputes and withdraw

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**Application:** In this case, the Operational Creditor followed the procedure under Regulation

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## Parties

- **Judges:** Ratakonda…; Narender Kumar…; +1 more
- **Appellants:** ZTE Corpo…
- **Respondents:** Smartron India…; Smartron India…
- **Advocates:** Somit K…; Mayur M…; +5 more

## Timeline

- **2019-09-09 — Admission of Section 9…**: The Tribunal admitted the petition filed under Section 9 of the Insolvency and Bankruptcy…
- **2019-09-26 — Public Annou…**: The Interim Resolution Professional made a public announcement under Form-A inviting…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12A — (1) Subject to sub](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12a)

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