# In the matter of Young Mind Restaurant Pvt. Ltd. (IB) 967(ND)2019

> NCLT judgment dated 2019-07-18. Citation: TCN-2019-NCLT-02442. The case involves an application by an Operational Creditor, M/s. Shree Bala Ji Super Foods,…

- **Court:** NCLT
- **Order date:** 18 Jul 2019
- **Citation:** TCN-2019-NCLT-02442
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/young-mind-restaurant-pvt-ltd-ib-967nd2019-0bd09334

## Summary

### Background

The case involves an application by an Operational Creditor, M/s. Shree Bala Ji Super Foods, against a Corporate Debtor, M/s. Yong Mind rest Restaurant Pvt. Ltd., under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Operational Creditor claimed that the Corporate Debtor defaulted on payments for the supply of soft drinks and juices. The Corporate Debtor's payments became irregular, leading the Operational Creditor to stop supplies after 2019-01-19. Repeated requests and reminders were sent to the Corporate Debtor to liquidate their dues. The Corporate Debtor issued a cheque of Rs. 3 lakhs, which was dishonoured. A demand notice under Section 8 of the IBC was issued but not responded to.

## Facts

M/s. Shree Bala Ji Super Foods (Operational Creditor) filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, against M/s. Yong Mind rest Restaurant Pvt. Ltd. (Corporate Debtor). The Operational Creditor supplied soft drinks and juices to the Corporate Debtor, maintaining a running account. Payments from the Corporate Debtor became irregular, leading the Operational Creditor to cease supplies after January 19, 2019. Repeated requests for payment were made. The Corporate Debtor issued a cheque of Rs. 3 lakhs, which was dishonoured. A demand notice under Section 8 of the IBC was issued but received no response. The Corporate Debtor did not appear after notice, leading to ex-parte proceedings. The absence of any pre-existing dispute was noted. The

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## Issues and analysis

### Issue 1: Whether the application for initiation of Corporate Insolvency Resolution Process under Section 9 …

**Ratio:** The application can be admitted if there is a debt and a default in payment of that debt,

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**Reasoning:** The court noted that the Operational Creditor had provided evidence of debt and default.

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**Interpretation:** Section 9 of the IBC allows an operational creditor to initiate CIRP if a debt

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**Application:** Given the evidence of debt, default, and the absence of a pre-existing dispute,

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## Parties

- **Judges:** Ina Mal…; V.K. SUB…
- **Appellants:** M/s. Shree Bala…
- **Respondents:** M/s. Yong Mind…

## Timeline

- **2019-01-19 — Cessation of…**: Operational Creditor stopped supplying…
- **N/A — Cheque Dish…**: Cheque of Rs. 3 lakhs issued by…

## 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)

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