# In the matter of Aspire Fitness Private Limited

> NCLT judgment dated 2023-11-23. Citation: TCN-2023-NCLT-00597. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 23 Nov 2023
- **Citation:** TCN-2023-NCLT-00597
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/aspire-fitness-private-limited-9f2f565e

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) by Mr. Amit N. Gandhi and Mr. Navnitlal U. Gandhi, the Operational Creditors (OCs), to initiate Corporate Insolvency Resolution Process (CIRP) against Aspire Fitness Private Limited, the Corporate Debtor (CD). The OCs and CD had a Leave and License Agreement, where the CD was obligated to pay a license fee including maintenance, electricity, and water bills. The OCs claimed that the CD defaulted on payments amounting to Rs. 1,34,97,857.84. The CD was set ex-parte, but the OCs were directed to issue notice to the CD. The CD did not appear.

## Facts

Mr. Amit N. Gandhi and Mr. Navnitlal U. Gandhi (OCs) jointly filed an application under Section 9 of the IBC to initiate CIRP against Aspire Fitness Private Limited (CD). The OCs and CD entered into a Leave and License Agreement on 28.01.2018, where the CD was to pay a license fee including maintenance. The OCs claimed the CD defaulted on payments totaling Rs. 1,34,97,857.84, including license fees, electricity, and water bills. The CD issued a letter seeking rent reduction due to COVID-19. The OCs issued monthly invoices from November 2019 to January 2021. The OCs terminated the agreement on 25.03.2021 via email and issued a demand notice under Section 8 of the IBC on 19.10.2021. The CD was set ex-parte on 23.03.2023. The OCs' banker, ICICI Bank, received limited

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## Issues and analysis

### Issue 1: Whether an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) is …

**Ratio:** Section 5(20) of the IBC defines 'operational creditor' and Section 3(23) defines

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**Reasoning:** The court reasoned that the legislative intent behind Section 9 of the IBC is to allow

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**Interpretation:** The interpretation of Section 5(20) and Section 3(23) of the IBC, along with

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**Application:** In this case, the application was filed jointly by Mr. Amit N. Gandhi and Mr.

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## Parties

- **Judges:** K. R. SAJI…; Madhu S…
- **Appellants:** AMIT N. G…
- **Respondents:** ASPIRE FITNESS…

## Timeline

- **2018-01-28 — Leave and License…**: OCs entered into a Leave and…
- **2020-11-01 — CD Seeks Rent…**: CD issued a letter seeking rent…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(20) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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