# In the matter of Vama Apparels (India) Pvt. Limited TCP No.616-I&BC-NCLT-MB-MAH-2017

> NCLT judgment dated 2018-05-17. Citation: TCN-2018-NCLT-01386. This case involves a petition transferred from the Hon'ble High Court at Bombay Judicature.…

- **Court:** NCLT
- **Order date:** 17 May 2018
- **Citation:** TCN-2018-NCLT-01386
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/vama-apparels-india-pvt-limited-tcp-no616-ibc-nclt-mb-mah-2017-069e04a6

## Summary

### Background

This case involves a petition transferred from the Hon'ble High Court at Bombay Judicature. Initially, a petition was filed as Company Petition No. 1238 of 2015 under Ordinary Original Civil Jurisdiction on 17.07.2015, before the High Court for winding up, invoking jurisdiction under sections 433 and 434 of the Companies Act, 1956, read with Section 271(2)(o) of the Companies Act, 2013, pertaining to a debt of ₹21,63,359. The petitioner, GAS Jeans Pvt. Ltd., an operational creditor, claimed that Vama Apparels (India) Pvt. Limited, the corporate debtor, owed them money based on a franchise agreement. The operational creditor alleged discrepancies in stock and overdue payments. The corporate debtor denied the claims and argued that the demand notice was served after the

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## Facts

GAS Jeans Pvt. Ltd. (Operational Creditor) and Vama Apparels (India) Pvt. Limited (Corporate Debtor) entered into a Memorandum of Understanding (MoU) on 16.08.2011 for selling GAS products through a franchise. The MoU was initially for three years, commencing from 01.08.2011. The Operational Creditor alleged that the Corporate Debtor was not prompt in settling dues, despite regular follow-ups. In November 2014, a discrepancy in stock of 224 pieces was noted. After a stock reconciliation on 27.11.2014, a shortfall of 329 pieces was found. The Operational Creditor claimed a debt of ₹21,63,359, comprising ₹9,65,238 as per pay-out sheet and ₹11,98,121 as the cost of the missing 329 pieces. An advocate notice was issued on 03.03.2015 demanding the amount with 18% interest.

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## Issues and analysis

### Issue 1: Whether the petition under Section 9 of the …

**Ratio:** The legal principle is that a petition under Section 9 can be admitted if a debt and

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**Reasoning:** The court reasoned that based on the totality of the facts and circumstances, the debt

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**Interpretation:** The interpretation of Section 9 involves determining whether the operational

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**Application:** In this case, the court applied the ratio by examining the evidence presented

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## Parties

- **Judges:** M.K. Sh…
- **Appellants:** Gas Jeans Pvt.…
- **Respondents:** Vama Apparels…
- **Advocates:** Vipul S…; Suvarna…

## Timeline

- **2011-08-01 — MoU Commen…**: Memorandum of Understanding (MoU) between GAS Jeans Pvt. Ltd. and Vama Apparels (India)…
- **2014-11-01 — Stock Discr…**: Discrepancy in stock of 224…

## 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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