# In the matter of Inox Wind Limited

> NCLT judgment dated 2024-02-23. Citation: TCN-2024-NCLT-02426. M/s Steel Mech Engineers filed a petition under Section 9 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 23 Feb 2024
- **Citation:** TCN-2024-NCLT-02426
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/inox-wind-limited-cbe3d04e

## Summary

### Background

M/s Steel Mech Engineers filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s Inox Wind Ltd, claiming an operational debt of Rs. 1,88,53,723, which included principal and interest. The respondent, M/s Inox Wind Ltd, is a company incorporated on 09.04.2009. The applicant, M/s Steel Mech Engineers, is a partnership firm and a supplier of plant, machinery, tools, and fabrication items. The respondent opposed the application, stating that the principal amount had already been paid and that the claim was now only for interest, which was not agreed upon. The respondent also argued that there was a pre-existing dispute regarding the quality of the supplied material.

## Facts

M/s Steel Mech Engineers (Applicant) filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s Inox Wind Ltd (Respondent). The Applicant claimed an operational debt of Rs. 1,88,53,723, including a principal amount of Rs. 97,34,507 and interest of Rs. 91,19,216. The Respondent argued that the principal amount had already been paid and the claim was solely for interest, which was not agreed upon. The Respondent also claimed a pre-existing dispute regarding the quality of the supplied material, supported by an email dated 06.09.2018. The Applicant contended that it is an MSME unit entitled to receive payment within 45 days and that the Respondent deliberately defaulted. The

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## Issues and analysis

### Issue 1: Whether the CIRP can be initiated / triggered solely on the basis of the un-paid amount of interest …

**Ratio:** CIRP cannot be initiated solely based on the unpaid amount of interest when the entire

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**Reasoning:** The court reasoned that the 'interest' component alone cannot be claimed or pursued in

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**Interpretation:** The court interpreted that the intent of the IBC is to resolve insolvency, not

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

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## Parties

- **Judges:** Sh. Harnam Singh…; SH. L. N.…
- **Appellants:** M/s. Steel Mech…
- **Respondents:** M/s Inox Wind…

## Timeline

- **2009-04-09 — Incorporation of…**: M/s Inox Wind Ltd…
- **2017-01-21 — Date of D…**: Applicant claimed the date…

## 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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