# In the matter of Varadha Steels Pvt Ltd TCP-517-(KB)-2017

> NCLT judgment dated 2017-08-22. Citation: TCN-2017-NCLT-00544. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 22 Aug 2017
- **Citation:** TCN-2017-NCLT-00544
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/varadha-steels-pvt-ltd-tcp-517-kb-2017-050efdc6

## Summary

### Background

The case involves an application filed 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, by an Operational Creditor against a Corporate Debtor. The Operational Creditor sought to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor.

## Facts

Loiwal Steel House, the Operational Creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Varadha Steels Private Limited, the Corporate Debtor. The Operational Creditor claimed Rs. 82,85,408.25 as principal and Rs. 39,76,992 as interest, totaling Rs. 1,22,62,400.25. A notice under Section 8 of the I&B Code was sent on 2017-02-27. The Corporate Debtor replied on 2017-03-08, admitting to an outstanding amount of Rs. 63,82,685.09 but claiming payments were made to a sister concern. The Operational Creditor submitted an affidavit and bank statement. The Corporate Debtor was unable to explain the admission made in their reply regarding the outstanding debt.

## Issues and analysis

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

**Ratio:** The legal principle applied is that if the Corporate Debtor admits to an outstanding debt

…

**Reasoning:** The court reasoned that the Corporate Debtor admitted to an outstanding debt of Rs.

…

**Interpretation:** The interpretation of Section 9 of the I&B Code, 2016, is that if the

…

**Application:** In this case, the Corporate Debtor's admission of the outstanding debt, coupled

…

## Parties

- **Judges:** CH. MOHD SHARIEF…; S. VIJAYARA…
- **Appellants:** LOIWAL STEE…
- **Respondents:** Varadha Steels…; VARADHA STEELS…
- **Advocates:** Pawan Jh…; Gopin…

## Timeline

- **2017-02-27 — Notice under Section 8…**: The Operational Creditor sent a notice to the Corporate Debtor under Section 8 of the I&B…
- **2017-03-08 — Reply by Corporate…**: The Corporate Debtor replied to the notice, admitting to an outstanding amount of Rs.…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-chandigarh/varadha-steels-pvt-ltd-tcp-517-kb-2017-050efdc6