# In the matter of Southern Investment Private Limited IBA-146-2020

> NCLT judgment dated 2021-03-15. Citation: TCN-2021-NCLT-02696. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 15 Mar 2021
- **Citation:** TCN-2021-NCLT-02696
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/southern-investment-private-limited-iba-146-2020-99667920

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) by Mr. Baiju Cheriyan, an Operational Creditor, against M/s. Southern Investments Private Limited, the Corporate Debtor, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claims that the Corporate Debtor owes him Rs. 26,68,752. The Corporate Debtor is a private limited company incorporated on 01.04.1998. The Operational Creditor submitted his resignation on 31.07.2017 and was relieved from employment on 30.09.2017. A full and final settlement of Rs. 22,04,333 was approved by the Corporate Debtor's Accounts Department on 17.10.2017, but the amount was not disbursed. The Operational Creditor also filed an application

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## Facts

Mr. Baiju Cheriyan, the Operational Creditor, was employed by M/s. Southern Investments Private Limited, the Corporate Debtor, as a 'Site Supervisor' starting on 17.08.1992. He was later promoted and transferred to the Chennai Branch on 01.11.2000. He submitted his resignation on 31.07.2017, holding the post of 'Branch Chief Engineer' with a gross pay of Rs. 84,002 per month. His resignation was accepted on 31.07.2017, and he was relieved on 30.09.2017. A full and final settlement of Rs. 22,04,333 was approved by the Accounts Department on 17.10.2017, but the Corporate Debtor did not disburse the amount. The Operational Creditor was not paid salary from January 2017 until his resignation. He filed an application before the Deputy Commissioner of Labour, who ordered the

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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 IBC allows an operational creditor to initiate CIRP against a corporate

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**Reasoning:** The Tribunal considered the submissions and documents presented by the Operational

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

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**Application:** The Tribunal found that the Operational Creditor had demonstrated the existence

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## Parties

- **Judges:** R. VARADH…; Anil Ku…
- **Appellants:** Baiju Che…
- **Respondents:** Southern Investmen…

## Timeline

- **1992-07-06 — Offer Le…**: Offer Letter issued to the Operational…
- **1992-08-17 — Joining…**: Operational Creditor joined as an employee of…

## 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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