# In the matter of DLKH Hospitality Services Private Limited

> NCLT judgment dated 2024-02-19. Citation: TCN-2024-NCLT-02531. Dhanashree Electronics Limited, the operational creditor, filed an application under Section 9…

- **Court:** NCLT
- **Order date:** 19 Feb 2024
- **Citation:** TCN-2024-NCLT-02531
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/dlkh-hospitality-services-private-limited-1b7e4f6d

## Summary

### Background

Dhanashree Electronics Limited, the operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against DLKH Hospitality Services Private Limited, the corporate debtor, seeking initiation of the Corporate Insolvency Resolution Process (CIRP). The operational creditor claimed a default of Rs. 1,35,36,900/- including interest till 01.10.2022. The claim included license fees, service charges, and reimbursement of electricity charges. The corporate debtor failed to appear despite multiple notices, and no written submissions were filed denying the operational creditor's claims.

## Facts

Dhanashree Electronics Limited (DEL), the operational creditor, filed a petition against DLKH Hospitality Services Private Limited (DLKH), the corporate debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016. DEL claimed that DLKH defaulted on payments totaling Rs. 1,35,36,900/-, which included interest calculated up to 01.10.2022. This amount comprised unpaid license fees, service charges, and electricity reimbursement. DEL and DLKH had entered into a 'Leave and License' agreement and a 'Service Agreement' on 06.07.2017, where DEL provided licensed premises and services to DLKH for a monthly fee. DLKH initially paid the bills but stopped payments from January 2020 onwards. DEL issued a demand notice on 07.11.2022, requesting payment within 10 days. DLKH

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## Issues and analysis

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

**Ratio:** Section 10A of the Insolvency and Bankruptcy Code, 2016, suspends the initiation of

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**Reasoning:** The court reasoned that after deducting the default amount that fell within the period

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**Interpretation:** Section 10A provides a moratorium on initiating CIRP for defaults occurring

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**Application:** The court applied Section 10A by excluding the default amount that occurred

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## Parties

- **Judges:** BIDISHA BA…; D. Ar…
- **Appellants:** Dhanashree…
- **Respondents:** DLKH Hospitality…

## Timeline

- **2017-07-06 — Leave and License Agreement and Service…**: Dhanashree Electronics Limited and DLKH Hospitality Services Private Limited entered into…
- **2020-01-01 — Default in P…**: DLKH Hospitality Services Private Limited stopped payment of monthly bills from January…

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