# In the matter of Superchem Coating Pvt. Ltd. CP(IB) No. 685-AHM-2019

> NCLT judgment dated 2021-12-07. Citation: TCN-2021-NCLT-00247. Padam Electronics, an operational creditor, filed an application under Section 9 of the…

- **Court:** NCLT
- **Order date:** 7 Dec 2021
- **Citation:** TCN-2021-NCLT-00247
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/superchem-coating-pvt-ltd-cpib-no-685-ahm-2019-04a8c051

## Summary

### Background

Padam Electronics, an operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC) against Superchem Coatings Pvt. Ltd, the corporate debtor, for initiating the Corporate Insolvency Resolution Process (CIRP). The application was based on the corporate debtor's alleged default in paying an operational debt of Rs. 10,54,179. The operational creditor had supplied a Gas Fired Trolley Oven to the corporate debtor as per a purchase order dated 20.03.2018, with an invoice dated 10.08.2018. While the corporate debtor made payments for subsequent consignments, a portion of the amount for the goods sold under the invoice remained unpaid, citing defects in the goods.

## Facts

Padam Electronics (Operational Creditor) supplied a Gas Fired Trolley Oven to Superchem Coatings Pvt. Ltd (Corporate Debtor) as per purchase order dated 2018-03-20 and invoice dated 2018-08-10. The Corporate Debtor made payments for subsequent consignments but did not fully pay for the goods sold under the 2018-08-10 invoice, claiming the goods were defective. The Operational Creditor issued a legal notice dated 2019-05-06 demanding payment. The Corporate Debtor replied on 2019-05-22, admitting part of the debt but disputing the actual amount, citing poor workmanship of the furnace. The Operational Creditor served a demand notice under Section 8 of IBC on 2019-07-26, but the Corporate Debtor did not reply or make payment. The Corporate Debtor claimed the oven burst in

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the IBC for initiating CIRP against the Corporate Debtor …

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

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**Reasoning:** The court reasoned that the Corporate Debtor's defense of a pre-existing dispute

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**Interpretation:** Section 9 of the IBC is interpreted to mean that a CIRP application can be

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**Application:** The court applied the ratio to the facts by noting that the Corporate Debtor

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## Parties

- **Judges:** Madan B.…; Ajai Das Me…
- **Appellants:** Padam Elect…
- **Respondents:** Superchem…
- **Advocates:** Sunil Bh…; Niraj Tr…

## Timeline

- **2018-03-20 — Purchase Ord…**: Date of the purchase order for…
- **2018-08-10 — Invoice…**: Date of the invoice for…

## 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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