# In the matter of Hanson Petro Private Limited CP (IB) No. 277-Chd-Pb-2019

> NCLT judgment dated 2023-04-20. Citation: TCN-2023-NCLT-03693. M/s Vijay Paints & Chemicals, an operational creditor, filed a petition under Section 9 of the…

- **Court:** NCLT
- **Order date:** 20 Apr 2023
- **Citation:** TCN-2023-NCLT-03693
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/hanson-petro-private-limited-cp-ib-no-277-chd-pb-2019-6b3e88ac

## Summary

### Background

M/s Vijay Paints & Chemicals, an operational creditor, filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s Hanson Petro Private Limited, the corporate debtor, due to unpaid operational debt. The operational creditor claimed that the corporate debtor defaulted on payments for goods delivered between 16.03.2018 and 08.09.2018. The corporate debtor contended that the goods supplied were of poor quality, leading to losses, and initiated litigation in the Commercial Court, Jalandhar, for recovery of damages. The Adjudicating Authority examined the issues of service of demand notice, existence of a pre-existing dispute, and limitation period.

## Facts

M/s Vijay Paints & Chemicals, the operational creditor, supplied Ethyl Acetate to M/s Hanson Petro Private Limited, the corporate debtor. The corporate debtor failed to make payments for goods delivered between 16.03.2018 and 08.09.2018, resulting in a default of Rs. 7,91,121/-. The operational creditor issued a demand notice on 22.03.2019. The corporate debtor replied on 15.04.2019, claiming the supplied chemical was of poor quality and initiated litigation in the Commercial Court, Jalandhar, for recovery of damages of Rs. 10 lakhs on 11.07.2019. The operational creditor filed a petition under Section 9 of the IBC on 16.04.2019, which was later re-filed on 10.05.2019. The corporate debtor argued that a dispute existed regarding the quality of goods. The

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## Issues and analysis

### Issue 1: Whether the demand notice in Form 3 & …

**Ratio:** A demand notice is considered duly served if it is issued by the operational creditor via

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**Reasoning:** The Adjudicating Authority observed that the demand notice was sent via registered post

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**Interpretation:** The legal principle is that proper service of a demand notice is a prerequisite

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**Application:** In this case, the demand notice was sent via registered post and email, and the

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## Parties

- **Judges:** Harnam Singh…; SUBRATA KUM…
- **Appellants:** M/s Vijay Paints…
- **Respondents:** M/s Hanson Petro…

## Timeline

- **2018-03-16 — First Invoice…**: First invoice No.B155 was…
- **2018-03-16 — Default P…**: The payment was not received for the goods…

## 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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