# In the matter of Apace Builders and Contractors Pvt. Ltd. IB-608(ND)-2021

> NCLT judgment dated 2022-09-15. Citation: TCN-2022-NCLT-01060. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 15 Sept 2022
- **Citation:** TCN-2022-NCLT-01060
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/apace-builders-and-contractors-pvt-ltd-ib-608nd-2021-52585c98

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by RKSK Steel India Limited, the Operational Creditor/Applicant, against Apace Builders and Contractors Pvt. Ltd., the Corporate Debtor/Respondent, for initiation of Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed that the Corporate Debtor defaulted on payments for TMT bars supplied for their business purposes. The Corporate Debtor contested the application, claiming a pre-existing dispute due to an amicable settlement involving the allotment of flats in a group housing project in lieu of the outstanding debt.

## Facts

RKSK Steel India Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Apace Builders and Contractors Pvt. Ltd. (Corporate Debtor) for initiation of Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed that they supplied TMT bars to the Corporate Debtor for several years. The Corporate Debtor allegedly issued three cheques dated 07.11.2019, each for Rs. 1,00,00,000/- and Rs. 31,51,500/-, which were dishonored due to 'Payment stopped by drawer'. The last payment was received on 23.10.2020, with a total outstanding amount of Rs. 1,59,91,031/-. The Operational Creditor sent a demand notice dated 16.04.2021, followed by another on 11.08.2021, and finally via email. The Corporate

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## Issues and analysis

### Issue 1: Whether a pre-existing dispute exists between the Operational Creditor and the Corporate Debtor, …

**Ratio:** The Hon'ble Supreme Court has laid down the principle that a 'pre-existing dispute' which

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**Reasoning:** The court found that the Corporate Debtor had raised a dispute with sufficient

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**Interpretation:** The term 'dispute' is interpreted as a conflict or controversy; a conflict of

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**Application:** In this case, the court found that the Corporate Debtor had disputed the

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## Parties

- **Judges:** Sh. Dharminder…; BINOD KUMAR…
- **Appellants:** RKSK Steel India…
- **Respondents:** Apace Builders…

## Timeline

- **2019-11-07 — Cheque Is…**: Corporate Debtor issued 3 cheques dated 07.11.2019 for Rs. 1,00,00,000/- and Rs.…
- **2020-10-23 — Last Payment…**: The Operational Creditor received the…

## 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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