# In the matter of Fashion Influence Clothing India Private Limited

> NCLT judgment dated 2023-11-22. Citation: TCN-2023-NCLT-00651. Smartpaddle Technology Private Limited, the operational creditor, filed an application under…

- **Court:** NCLT
- **Order date:** 22 Nov 2023
- **Citation:** TCN-2023-NCLT-00651
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/fashion-influence-clothing-india-private-limited-97723665

## Summary

### Background

Smartpaddle Technology Private Limited, the operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Fashion Influence Clothing India Private Limited, the corporate debtor, for initiating the Corporate Insolvency Resolution Process (CIRP). The operational creditor claimed a total debt of Rs. 5,15,21,359.82, including a principal of Rs. 4,52,12,353 and interest of Rs.63,09,037.07 as of November 25, 2022, with the date of default being June 30, 2022. The operational creditor provided solutions to businesses wanting to order custom-made goods, acting as a platform between businesses. The corporate debtor placed orders for packaging materials and other products through this platform. The operational creditor procured

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## Facts

Smartpaddle Technology Private Limited (Operational Creditor) filed an application against Fashion Influence Clothing India Private Limited (Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Operational Creditor claimed a debt of Rs. 5,15,21,359.82, including a principal of Rs. 4,52,12,353 and interest of Rs.63,09,037.07 as of November 25, 2022, with the date of default being June 30, 2022. The Operational Creditor provided a platform for businesses to order custom-made goods. The Corporate Debtor placed orders for packaging materials and other products through this platform. The Operational Creditor procured goods from vendors and resold them to the Corporate Debtor. The Corporate Debtor failed to make payments for goods supplied

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the IBC is maintainable based on the breach of the …

**Ratio:** The breach of a settlement agreement or undertaking does not automatically disqualify it

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**Reasoning:** The Adjudicating Authority considered the Shortfall Undertaking and the underlying

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**Interpretation:** Section 5(21) of the IBC defines 'operational debt' as a claim in respect of

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**Application:** The Adjudicating Authority determined that the underlying debt arose from the

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## Parties

- **Judges:** SANJIV…; Venkataraman…
- **Appellants:** Smartpaddle…
- **Respondents:** Fashion Influence…
- **Advocates:** Raj Jha…; Raghav Rajeev…

## Timeline

- **2021-12-25 — Orders P…**: Corporate Debtor placed orders for packaging materials and other products through the…
- **2022-04-07 — Orders P…**: Corporate Debtor placed orders for packaging materials and other products through the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(21) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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