# In the matter of VA Tech Wabag Ltd. CP-539-(IB)-2017

> NCLT judgment dated 2017-10-06. Citation: TCN-2017-NCLT-00303. The case involves an application under Section 9 of the Insolvency and Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 6 Oct 2017
- **Citation:** TCN-2017-NCLT-00303
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/va-tech-wabag-ltd-cp-539-ib-2017-7048eefb

## Summary

### Background

The case involves an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Consolidated Construction Consortium Limited (Operational Creditor) filed an application against VA Tech Wabag Limited (Corporate Debtor) seeking initiation of Corporate Insolvency Resolution Process (CIRP). The NCLT initially found the application fit for admission but provided an opportunity to the Corporate Debtor to settle the dues. The Corporate Debtor offered to pay only 50% of the principal amount without interest, which was not accepted by the Operational Creditor.

## Facts

Consolidated Construction Consortium Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against VA Tech Wabag Limited (Corporate Debtor) for initiating Corporate Insolvency Resolution Process (CIRP). The principal amount claimed by the Operational Creditor was Rs. 1,50,13,529/-. The NCLT initially considered the application fit for admission but granted the Corporate Debtor an opportunity to settle the dues. The Corporate Debtor offered to pay only 50% of the principal amount (Rs. 75,06,764.50) without interest, which the Operational Creditor rejected. The Corporate Debtor's counsel had previously stated that the Corporate Debtor would seek an opportunity to settle the amount in dispute if the application

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## Issues and analysis

### Issue 1: Whether the application CP/539/(IB)/CB/2017 filed by the Operational Creditor is admissible under …

**Ratio:** The Insolvency and Bankruptcy Code, 2016, provides a framework for the resolution of

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**Reasoning:** The NCLT concluded that the Operational Creditor had fulfilled all the requirements of

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**Interpretation:** Section 9 of the IBC is interpreted to allow for the initiation of CIRP when an

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**Application:** The NCLT applied the provisions of Section 9 to the facts of the case, finding

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## Parties

- **Judges:** CH. MOHD SHARIEF…; S. VIJAYARA…
- **Appellants:** Consolidated…
- **Respondents:** VA TECH WAB…

## Timeline

- **2017-09-11 — Hearing of C…**: Counsels for the Operational Creditor and Corporate Debtor were heard, and the matter was…
- **2017-09-14 — Order Pa…**: A detailed order was passed, providing an opportunity to the Corporate Debtor to settle…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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