# In the matter of Vivanta Laboratories Pvt. Ltd. IA(IBC)656-2021 in CP(IB) No. 261-9-HDB-2020

> NCLT judgment dated 2021-12-02. Citation: TCN-2021-NCLT-00306. The case involves an application (IA (IBC) No.656 of 2021) filed by the Operational Creditor…

- **Court:** NCLT
- **Order date:** 2 Dec 2021
- **Citation:** TCN-2021-NCLT-00306
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/vivanta-laboratories-pvt-ltd-iaibc656-2021-in-cpib-no-261-9-hdb-2020-b4e001a0

## Summary

### Background

The case involves an application (IA (IBC) No.656 of 2021) filed by the Operational Creditor under section 12A of the I&B Code, 2016, to withdraw the main petition (CP(IB) No.261/9/HDB/2020). The Financial Creditor had previously filed a memo dated 01.11.2021 seeking leave to withdraw the application. The Tribunal had ordered the initiation of the insolvency resolution process against the Corporate Debtor, and a settlement was purportedly reached between the parties on 14.10.2021. The petitioner then filed IA (IBC) No.656 of 2021 to withdraw the main petition, and the Tribunal kept the proceedings on hold. However, the Corporate Debtor breached the terms of the settlement.

## Facts

Sun (Inox) Steels Pvt Ltd, the Operational Creditor, initiated proceedings against Vivanta Laboratories Pvt Ltd, the Corporate Debtor, under Section 9 of the IBC, 2016. An insolvency resolution process was initiated against the Corporate Debtor, and a settlement was purportedly reached between the parties on 14.10.2021. Subsequently, the Operational Creditor filed IA (IBC) No.656 of 2021 to withdraw the main petition based on this settlement. However, the Corporate Debtor breached the terms of the settlement by failing to make the required payments. The Operational Creditor then sought to withdraw the IA (IBC) No.656 of 2021 to pursue the matter against the Corporate Debtor. The Financial Creditor had also filed a memo dated 01.11.2021 seeking leave to withdraw the

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## Issues and analysis

### Issue 1: Whether the Operational Creditor should be allowed to withdraw IA (IBC) No.656 of 2021, given the …

**Ratio:** When a settlement agreement is breached by one party, the other party is entitled to

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**Reasoning:** The Tribunal noted that the Corporate Debtor had breached the terms of the settlement by

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**Interpretation:** This issue concerns the enforceability of settlement agreements in insolvency

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**Application:** In this case, the Corporate Debtor's failure to make payments as per the

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. VEERA BRAHMA…
- **Appellants:** Sun (Inox)Steels…
- **Respondents:** Vivanta Laboratori…

## Timeline

- **2021-10-14 — Settlement Ag…**: A settlement was purportedly…
- **2021-11-01 — Memo Fil…**: The Financial Creditor filed a memo…

## 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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