# In the matter of Brijbihari Metallics Private Limited

> NCLT judgment dated 2023-08-24. Citation: TCN-2023-NCLT-01947. The case involves an application under Section 9 of the Insolvency & Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 24 Aug 2023
- **Citation:** TCN-2023-NCLT-01947
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/brijbihari-metallics-private-limited-f896165e

## Summary

### Background

The case involves an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, filed by M/S Seven Star Steels Limited (Operational Creditor) against M/S Brijbihari Metallics Private Limited (Corporate Debtor) for default in payment of an outstanding amount of Rs. 1,07,03,155/-. The Operational Creditor claimed to have supplied sponge iron and billets to the Corporate Debtor based on verbal orders and issued 17 invoices between 11.01.2020 and 27.02.2020. The Corporate Debtor argued that the debt was related to a consignment of raw material procured for different manufacturers and that Rajratan Smelters Ltd. had acknowledged the buyer-consignee relationship and responsibility for the debt. The Corporate Debtor also contended that the application was not

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## Facts

M/S Seven Star Steels Limited (Operational Creditor) filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, against M/S Brijbihari Metallics Private Limited (Corporate Debtor) for an outstanding debt of Rs. 1,07,03,155/-. The Operational Creditor claimed to have supplied sponge iron and billets to the Corporate Debtor based on verbal orders, issuing 17 invoices between 11.01.2020 and 27.02.2020. The Corporate Debtor made payments totaling Rs. 5,82,31,367/- until 16.03.2020, with a final payment of Rs. 8 lakh on 11.05.2020. The Corporate Debtor argued that the debt was related to a consignment of raw material procured for different manufacturers and that Rajratan Smelters Ltd. had acknowledged the buyer-consignee relationship and

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the Insolvency & Bankruptcy Code, 2016 is …

**Ratio:** The principle is that the application under Section 9 is maintainable if the debt is

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**Reasoning:** The Adjudicating Authority found that the Corporate Debtor's claim of a 60-day payment

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

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**Application:** In this case, the Adjudicating Authority determined that the default occurred

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** M/S Seven Star…
- **Respondents:** M/S Brijbihari…

## Timeline

- **2019-01-01 — Corporate Debtor…**: The Corporate Debtor approached the Operational Creditor around 2019 for the supply of…
- **2020-01-11 — Invoices…**: The operational creditor issued 17…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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