# In the matter of YS Marchandise International Pvt. Ltd. IB-136-ND-2019

> NCLT judgment dated 2019-06-06. Citation: TCN-2019-NCLT-03032. YS Marchandise International Pvt. Ltd. filed an application under Section 10 of the Insolvency…

- **Court:** NCLT
- **Order date:** 6 Jun 2019
- **Citation:** TCN-2019-NCLT-03032
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ys-marchandise-international-pvt-ltd-ib-136-nd-2019-5d5f4031

## Summary

### Background

YS Marchandise International Pvt. Ltd. filed an application under Section 10 of the Insolvency and Bankruptcy Code, 2016, to initiate its own corporate insolvency resolution process (CIRP). The company is involved in the business of purchasing and selling goods, including footwear, apparel, and accessories. In 2016, Lotto SSIPL Lifestyles Pvt. Ltd., a major partner, withdrew from the business. Demonetization further impacted the business, leading to unsold stock for 10-12 months. The company faced difficulties in paying suppliers and availed credit from Zen Lefin Pvt. Ltd. and Neogrowth Credit Pvt. Ltd. Legal notices were received from suppliers like Adidas India Marketing Pvt. Ltd. and M & B Footwear Pvt. Ltd. due to non-payment.

## Facts

YS Marchandise International Pvt. Ltd. initiated CIRP under Section 10 of the IBC, 2016. The company's business involves trading footwear, apparel, and accessories. A major partner, Lotto SSIPL Lifestyles Pvt. Ltd., withdrew in 2016, impacting the business. Demonetization led to unsold stock and financial difficulties. The company availed credit from Zen Lefin Pvt. Ltd. and Neogrowth Credit Pvt. Ltd. Legal notices were received from Adidas India Marketing Pvt. Ltd. and M & B Footwear Pvt. Ltd. due to outstanding payments. Capfloat Financial Services Pvt. Ltd., a financial creditor, objected, alleging fund siphoning. The Corporate Applicant denied the allegations and stated that it is not disqualified under Section 11 of the Code. The Tribunal considered legal

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## Issues and analysis

### Issue 1: Whether the application filed by YS Marchandise International Pvt. Ltd. under Section 10 of the …

**Ratio:** The Adjudicating Authority has to only ensure that there is debt and default, all the

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**Reasoning:** The Tribunal considered the legal notices from Adidas India Marketing Pvt Ltd., DTDC 3PL

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**Interpretation:** Section 10 of the Insolvency and Bankruptcy Code, 2016 allows a corporate

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**Application:** The Tribunal applied the ratio from Unigreen Global Pvt. Ltd. and found that YS

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## Parties

- **Judges:** Ina Mal…; V.K. SUB…
- **Respondents:** YS Marchandise…

## Timeline

- **2016-01-01 — Withdrawal of Lotto…**: Lotto SSIPL Lifestyles Pvt. Ltd., a major partner of YS Marchandise International Pvt.…
- **2019-06-06 — Order Del…**: Order was delivered on…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 10 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-10)

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