# In the matter of Worldstar Fabrics LLP C.P. No. 1976-I&BP-2018

> NCLT judgment dated 2018-08-28. Citation: TCN-2018-NCLT-00890. Shanaya Fashions filed a company petition under Section 9 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 28 Aug 2018
- **Citation:** TCN-2018-NCLT-00890
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/worldstar-fabrics-llp-cp-no-1976-ibp-2018-71f06b3e

## Summary

### Background

Shanaya Fashions filed a company petition under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Worldstar Fabric LLP, the Corporate Debtor. The petition alleges that the Corporate Debtor defaulted on payments amounting to Rs. 2,56,30,190/- against various invoices raised by Shanaya Fashions. The invoices were for goods supplied between January 1, 2018, and March 5, 2018. The petitioner issued a demand notice, and the corporate debtor replied, citing financial difficulties and customer defaults as reasons for non-payment.

## Facts

Shanaya Fashions (the Petitioner) is a manufacturer of wearing apparel. Worldstar Fabric LLP (the Corporate Debtor) placed orders with Shanaya Fashions. Shanaya Fashions supplied and delivered goods to Worldstar Fabric LLP between January 1, 2018, and March 5, 2018, raising 24 invoices totaling Rs. 2,59,30,190/-, payable within 7 days of the invoice date. The Corporate Debtor defaulted on payments. Shanaya Fashions issued a demand notice on May 9, 2018, claiming Rs. 2,59,30,190/-. The Corporate Debtor replied on May 11, 2018, citing financial difficulties due to customer defaults. The Corporate Debtor requested the Petitioner not to initiate legal proceedings. The Corporate Debtor later raised issues of financial difficulties, defective goods, and short supply as

…

## Issues and analysis

### Issue 1: Whether the Corporate Debtor committed a default in making payment to the extent of Rs. …

**Ratio:** The legal principle is that if a debt is due and payable and the debtor fails to make

…

**Reasoning:** The court found that the Corporate Debtor failed to make payment against the invoices

…

**Interpretation:** The interpretation of 'default' under the IBC includes the non-payment of a

…

**Application:** The Corporate Debtor's failure to pay the invoices, despite the goods being

…

## Parties

- **Judges:** Bhaskara Pantula…; V. Nallasen…
- **Appellants:** Shanaya Fa…
- **Respondents:** Worldstar Fabrics…

## Timeline

- **2018-01-01 — Goods Sup…**: Petitioner supplied and delivered…
- **2018-03-05 — Last Date of…**: Last date of goods supplied and…

## 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)

---

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/worldstar-fabrics-llp-cp-no-1976-ibp-2018-71f06b3e