# In the matter of TSL Electro Power Private Limited IB-241-(ND)-2020

> NCLT judgment dated 2021-04-01. Citation: TCN-2021-NCLT-02501. The case involves a petition filed by M/s BM Pipes Private Limited, an operational creditor,…

- **Court:** NCLT
- **Order date:** 1 Apr 2021
- **Citation:** TCN-2021-NCLT-02501
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/tsl-electro-power-private-limited-ib-241-nd-2020-14b10cf0

## Summary

### Background

The case involves a petition filed by M/s BM Pipes Private Limited, an operational creditor, against TSL Electro Power Private Limited, the corporate debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) for an alleged default. The operational creditor claimed an outstanding balance of Rs. 2,34,256/- including interest. The operational creditor is in the business of trading in BEC brand MS and PVC Conduct pipes and pipe fittings. The corporate debtor had placed purchase orders for conduit pipes and pipe fittings at a project in Gurugram, Haryana. The operational creditor issued two invoices amounting to Rs. 1,53,988/-. A demand notice dated 05.05.2019 was sent demanding payment of the

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## Facts

M/s BM Pipes Private Limited (operational creditor) filed a petition against TSL Electro Power Private Limited (corporate debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate CIRP. The operational creditor claimed an outstanding balance of Rs. 2,34,256/-, including interest, for the supply of conduit pipes and pipe fittings. The corporate debtor had placed purchase orders for these items. The operational creditor issued two invoices totaling Rs. 1,53,988/-. A demand notice dated 05.05.2019 was issued by the operational creditor. Subsequently, a settlement agreement was executed between the parties on 22.07.2019, and the corporate debtor paid Rs. 1,53,988/- between 15.01.2020 and 04.03.2020. The operational creditor admitted to

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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:** A petition under Section 9 of the IBC is not maintainable if the demand notice has been

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**Reasoning:** The court reasoned that the withdrawal of the demand notice and the subsequent payment of

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**Interpretation:** Section 9 of the IBC requires a valid demand notice as a prerequisite for

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**Application:** In this case, the operational creditor withdrew the demand notice dated

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## Parties

- **Judges:** P.S.N. P…; V.K. SUB…
- **Appellants:** M/s BM Pipes…
- **Respondents:** TSL Electro Power…

## Timeline

- **2019-05-05 — Demand Notice…**: Operational creditor sent a Demand Notice…
- **2019-07-22 — Settlement Ag…**: A settlement agreement was…

## 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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