# In the matter of Spray Engineering Devices Limited CP (IB) No. 407-Chd-Chd-2018

> NCLT judgment dated 2019-09-03. Citation: TCN-2019-NCLT-01619. IPRO Sugar Engineering Private Limited, the operational creditor, filed a petition under…

- **Court:** NCLT
- **Order date:** 3 Sept 2019
- **Citation:** TCN-2019-NCLT-01619
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/spray-engineering-devices-limited-cp-ib-no-407-chd-chd-2018-ad498dc3

## Summary

### Background

IPRO Sugar Engineering Private Limited, the operational creditor, filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Spray Engineering Devices Limited, the corporate debtor, for initiating the Corporate Insolvency Resolution Process (CIRP) due to unpaid invoices for consulting engineer services. The operational creditor claimed a total debt of ₹53,40,453/-, including a principal amount of ₹23,86,605/- and interest of ₹29,53,830/-. The operational creditor issued invoices from 29.02.2008 to 01.10.2009, with the debt due from the date of the first invoice. A demand notice was issued on 28.09.2018. The corporate debtor argued that the operational creditor had filed a suit for recovery and that the matter should be referred to arbitration

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## Facts

IPRO Sugar Engineering Private Limited (Operational Creditor) filed a petition against Spray Engineering Devices Limited (Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate CIRP. The claim was based on unpaid invoices for consulting engineer services provided between 29.02.2008 and 01.10.2009. The total debt claimed was ₹53,40,453/-, comprising ₹23,86,605/- as principal and ₹29,53,830/- as interest. A demand notice was issued on 28.09.2018. The Corporate Debtor argued that a suit for recovery had been filed by the Operational Creditor, and the matter should be referred to arbitration as per a High Court order dated 19.07.2018. The Corporate Debtor also claimed that the Operational Creditor was a shareholder and that

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## Issues and analysis

### Issue 1: Whether the petition filed by the operational creditor under Section 9 of the Insolvency and …

**Ratio:** Choosing not to avail the option of arbitration would not disentitle the operational

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**Reasoning:** The court reasoned that the operational creditor's decision not to pursue arbitration

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**Interpretation:** This interprets Section 9 of the IBC to provide an independent remedy for

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**Application:** The court applied this principle to the facts by stating that the existence of

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## Parties

- **Judges:** Ajay Kumar…; Pradeep R.…
- **Appellants:** IPRO Sugar…
- **Respondents:** Spray Engineering…
- **Advocates:** Yash Pal…; Deepak Kumar…; +1 more

## Timeline

- **2008-02-29 — First Invoi…**: Date of the first invoice issued by the…
- **2009-10-01 — Last Invoic…**: Date of the last invoice issued by the…

## 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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