# In the matter of Johnson Watch Company Private Limited

> NCLT judgment dated 2024-01-17. Citation: TCN-2024-NCLT-03011. The case involves an application filed by M/s Swiss Promotions Private Limited, the Operational…

- **Court:** NCLT
- **Order date:** 17 Jan 2024
- **Citation:** TCN-2024-NCLT-03011
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/johnson-watch-company-private-limited-6bdd73a8

## Summary

### Background

The case involves an application filed by M/s Swiss Promotions Private Limited, the Operational Creditor (OC), under Section 9 r/w Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s Johnson Watch Company Private Limited, the Corporate Debtor (CD). The OC claims that the CD defaulted on payments amounting to Rs. 1,57,03,726.94/- for supplied timepieces. The OC and CD had a long-standing business relationship with a recurring running account. The CD acknowledged the outstanding debt in emails dated 14.03.2020 and 11.05.2019. The CD also issued cheques towards part payment, some of which bounced, leading to a separate complaint under Section 138 of the

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## Facts

M/s Swiss Promotions Private Limited (Operational Creditor) filed an application to initiate Corporate Insolvency Resolution Process (CIRP) against M/s Johnson Watch Company Private Limited (Corporate Debtor) for defaulting on a payment of Rs. 1,57,03,726.94/-. The Operational Creditor supplied timepieces to the Corporate Debtor, and invoices were raised accordingly. The parties maintained a recurring running account since the inception of their business relationship. The Corporate Debtor acknowledged the outstanding debt in emails dated 14.03.2020 and 11.05.2019. The Corporate Debtor also issued cheques towards part payment, some of which bounced, leading to a separate complaint under Section 138 of the Negotiable Instruments Act. The last payment received from the

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the IBC for initiating …

**Ratio:** Section 9 of the IBC allows an operational creditor to initiate CIRP against a corporate

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**Reasoning:** The Adjudicating Authority found that the Operational Creditor had complied with the

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**Interpretation:** Section 9 of the IBC provides a mechanism for operational creditors to recover

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**Application:** In this case, the Operational Creditor filed an application under Section 9 of

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## Parties

- **Judges:** Ramalingam…; Sh. Avinash K.…
- **Appellants:** M/s Swiss…
- **Respondents:** M/s Johnson Watch…

## Timeline

- **2018-01-01 — Ledger Star…**: Ledger start date for…
- **2019-05-11 — Email Confi…**: Email from CD confirming…

## 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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