# In the matter of Indus Business Systems Limited CP (IB) No.363-10-HDB-2022

> NCLT judgment dated 2023-03-23. Citation: TCN-2023-NCLT-04088. The case pertains to a Company Petition (IB) No. 363/10/HDB/2022 filed under Section 10 of the…

- **Court:** NCLT
- **Order date:** 23 Mar 2023
- **Citation:** TCN-2023-NCLT-04088
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/indus-business-systems-limited-cp-ib-no363-10-hdb-2022-1d48ac3e

## Summary

### Background

The case pertains to a Company Petition (IB) No. 363/10/HDB/2022 filed under Section 10 of the Insolvency and Bankruptcy Code (IBC), 2016, read with Rule 7 of the I&B (AAA) Rules, 2016. M/s. Indus Business Systems Limited, the Corporate Applicant, filed the petition to initiate corporate insolvency resolution process. The company is involved in the development of packaged software but faced business difficulties due to lack of funds and absence of sales in the preceding seven months. An operational creditor, Sirus Business Solutions Private Limited, had stopped purchasing software from the corporate debtor and started demanding a refund of trade advance.

## Facts

M/s. Indus Business Systems Limited, a company involved in developing packaged software, filed a petition to initiate corporate insolvency resolution process (CIRP) under Section 10 of the Insolvency and Bankruptcy Code (IBC), 2016. The company faced financial difficulties, including a lack of sales for the past seven months due to a shortage of funds. Sirus Business Solutions Private Limited, a major operational creditor, stopped purchasing software from the company and demanded a refund of trade advances, with an outstanding amount of Rs. 1,88,54,304/-. The company's cash and cash equivalents as of 31.10.2022 were Rs. 7,47,092/-, and it had fixed assets worth Rs. 12,08,629/-. The company's members passed a resolution on 26.10.2022 to initiate CIRP. The petition was

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## Issues and analysis

### Issue 1: Whether the petition filed by M/s. Indus Business Systems Limited under Section 10 of the …

**Ratio:** Section 10 of the IBC, 2016, allows a corporate applicant to initiate CIRP if it meets

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**Reasoning:** The Tribunal considered the averments made in the petition, including the company's

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**Interpretation:** Section 10 provides a mechanism for a corporate debtor facing financial

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**Application:** The Tribunal applied Section 10 to the facts presented by M/s. Indus Business

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Respondents:** M/s. Indus…

## Timeline

- **2022-10-26 — Extra Ordinary General…**: Members of Indus Business Systems Limited…
- **2023-03-23 — Order Da…**: The NCLT Hyderabad Bench admitted the…

## 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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