# In the matter of Goodvalue Chemicals Pvt. Ltd.

> NCLT judgment dated 2024-07-11. Citation: TCN-2024-NCLT-01035. Mayfair Biotech Pvt. Ltd. filed an application under Section 9 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 11 Jul 2024
- **Citation:** TCN-2024-NCLT-01035
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/goodvalue-chemicals-pvt-ltd-a9976898

## Summary

### Background

Mayfair Biotech Pvt. Ltd. filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Good Value Chemicals Pvt. Ltd. for failing to pay an operational debt of Rs 2,16,90,392. The applicant, Mayfair Biotech, claimed to have supplied goods/chemicals and provided services to Good Value Chemicals. The corporate debtor allegedly delayed payments, leading to outstanding dues. The operational creditor issued a demand notice, but the corporate debtor claimed a pre-existing dispute.

## Facts

Mayfair Biotech Pvt. Ltd. (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Good Value Chemicals Pvt. Ltd. (Corporate Debtor) for an unpaid operational debt of Rs 2,16,90,392. As per an agreement dated 10.04.2015, Mayfair Biotech supplied goods/chemicals and provided services to Good Value Chemicals. The Corporate Debtor allegedly delayed payments, leading to the outstanding debt. Mayfair Biotech issued a demand notice on 21.12.2019 under Section 8 of the IBC. Good Value Chemicals replied on 31.12.2019, claiming a pre-existing dispute and substandard quality of goods supplied, issuing debit notes on 02.04.2019 and 04.04.2019. Mayfair Biotech also

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## Issues and analysis

### Issue 1: Whether a pre-existing dispute existed between Mayfair Biotech Pvt. Ltd. and Good Value Chemicals …

**Ratio:** The existence of a pre-existing dispute, even if it is not likely to succeed, is

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**Reasoning:** The court considered the exchange of debit notes between the parties and the MSME

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**Interpretation:** The court interpreted the Supreme Court's ruling in Mobilox Innovations Private

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**Application:** The court applied the ratio to the facts of the case, noting that the exchange

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## Parties

- **Judges:** MAHENDRA KHANDELWA…; Sanjeev R…
- **Appellants:** MAYFAIR BIOTECH…
- **Respondents:** GOOD VALUE…
- **Advocates:** Rajesh Ag…; Ajay S…

## Timeline

- **2015-04-10 — Agreement…**: Agreement executed between Mayfair Biotech and Good Value Chemicals for the supply of…
- **2016-05-26 — Substandard Material…**: Corporate Debtor claims substandard…

## 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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