# In the matter of TRK Textile (India) Pvt. Ltd. IBA-41-2020

> NCLT judgment dated 2021-11-01. Citation: TCN-2021-NCLT-00653. OPG Power Generation Private Limited filed IBA/41/2020 under Section 9 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 1 Nov 2021
- **Citation:** TCN-2021-NCLT-00653
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/trk-textile-india-pvt-ltd-iba-41-2020-17d2e05c

## Summary

### Background

OPG Power Generation Private Limited filed IBA/41/2020 under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against TRK Textile (India) Pvt. Ltd., claiming default in payment for power supply. The Operational Creditor and Corporate Debtor had a Power Supply Agreement dated 15.09.2015. The Operational Creditor claimed Rs.47,62,315/- which includes a sum of Rs.11,26,040/- towards principal and Rs.36,36,275/- towards interest on delay of payments.

## Facts

OPG Power Generation Private Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against TRK Textile (India) Pvt. Ltd. (Corporate Debtor) for initiating Corporate Insolvency Resolution Process (CIRP). The claim was for Rs.47,62,315/-, including principal and interest, arising from a Power Supply Agreement dated 15.09.2015. The Operational Creditor alleged that the Corporate Debtor defaulted on payments. The Corporate Debtor argued that the Operational Creditor unilaterally increased the price of power without proper agreement, and inflated the amount owed by levying unaccounted interest. The Corporate Debtor also stated that there was no agreement entered into for any increase in the cost of the power being

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## Issues and analysis

### Issue 1: Whether the Operational Creditor is entitled to claim an automatic increase in the price of power …

**Ratio:** The legal principle is that any increase in tariff based on fuel price increases (Clause

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**Reasoning:** The Adjudicating Authority reasoned that Clause 11.8 of the Agreement, which pertains to

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**Interpretation:** The interpretation of the agreement clauses indicates that while the

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**Application:** In this case, the Operational Creditor increased the tariff due to a rise in

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## Parties

- **Judges:** R. Sucha…; Anil Ku…
- **Appellants:** OPG Power…
- **Respondents:** TRK Textile…

## Timeline

- **2015-09-15 — Power Supply A…**: Power Supply Agreement entered into between OPG Power Generation Private Limited and TRK…
- **2018-01-24 — Hike in Fuel…**: Tariff was fixed at Rs.5.75 is increased by…

## 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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