# In the matter of Swati Mining Private Limited C.P. (IB) No. 1161-KB-2018

> NCLT judgment dated 2019-07-08. Citation: TCN-2019-NCLT-02630. The case involves an application filed by Sree Bishandas Iron Works, an operational creditor,…

- **Court:** NCLT
- **Order date:** 8 Jul 2019
- **Citation:** TCN-2019-NCLT-02630
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/swati-mining-private-limited-cp-ib-no-1161-kb-2018-f1644201

## Summary

### Background

The case involves an application filed by Sree Bishandas Iron Works, an operational creditor, under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Swati Mining Private Limited, the corporate debtor. The operational creditor claimed that it had advanced Rs. 63,00,000 to the corporate debtor for the purchase of iron billets in 2010, but the corporate debtor failed to deliver the goods and only refunded a portion of the amount. The operational creditor issued a demand notice under Section 8 of the Code, but the corporate debtor failed to pay the outstanding amount.

## Facts

In 2010, Sree Bishandas Iron Works (Operational Creditor) advanced Rs. 63,00,000 to Swati Mining Private Limited (Corporate Debtor) for purchasing Iron Billets, based on an oral purchase order. The Corporate Debtor acknowledged the order but failed to supply the Iron Billets. The Corporate Debtor only refunded Rs. 25,19,020 towards the debt. From March 28, 2017, the Corporate Debtor stopped making payments. The Operational Creditor claimed Rs. 37,80,980 plus interest at 12% p.a. from March 28, 2017. The Corporate Debtor admitted its liability in letters dated June 19, 2017, March 13, 2018, and April 5, 2018, requesting more time to repay due to market conditions. The Operational Creditor issued a demand notice on December 28, 2017, under Section 8 of the Insolvency and

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the Insolvency & …

**Ratio:** Section 9 of the Insolvency and Bankruptcy Code, 2016 allows an operational creditor to

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**Reasoning:** The Tribunal considered the documents and submissions made by the Operational Creditor,

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**Interpretation:** Section 9 of the IBC is interpreted to mean that if an operational debt exists,

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**Application:** In this case, the Corporate Debtor admitted its liability to the Operational

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## Parties

- **Judges:** Jinan…; Harish Chander…
- **Appellants:** SREE BISHANDAS…
- **Respondents:** Swati Mining…

## Timeline

- **2010-01-01 — Advance P…**: Operational Creditor advanced Rs. 63,00,000…
- **2017-03-28 — Payment S…**: Corporate Debtor stopped making…

## 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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