# In the matter of Kumar Brothers Enterprises Private Limited CP(IB) No.729-KB-2020

> NCLT judgment dated 2022-06-28. Citation: TCN-2022-NCLT-02012. Bansal Industries, an operational creditor, filed a Company Petition under Section 9 of the…

- **Court:** NCLT
- **Order date:** 28 Jun 2022
- **Citation:** TCN-2022-NCLT-02012
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/kumar-brothers-enterprises-private-limited-cpib-no729-kb-2020-72c04064

## Summary

### Background

Bansal Industries, an operational creditor, filed a Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Kumar Brother Enterprises Private Limited, a corporate debtor, due to unpaid operational debt. Bansal Industries claimed that Kumar Brother Enterprises owed ₹69,94,228 for the supply of metal sheets and water tank structures, along with an interest of ₹19,04,930, totaling ₹88,99,158. Bansal Industries sent a demand notice on July 15, 2019, and subsequently via email on August 17, 2019, which the corporate debtor did not respond to. Kumar Brother Enterprises argued that no operational debt was due and that the payment was contingent upon receiving funds from the Government of

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## Facts

Bansal Industries (Operational Creditor) supplied metal sheets and water tank structures to Kumar Brother Enterprises Private Limited (Corporate Debtor). The total amount due for the supplies was ₹69,94,228, with an additional interest of ₹19,04,930, bringing the total outstanding amount to ₹88,99,158. The invoices for the supplies became due and payable from their respective dates of issuance. Bansal Industries sent a demand notice to Kumar Brother Enterprises on July 15, 2019, under Section 8 of the Insolvency and Bankruptcy Code, which was returned unaccepted. A subsequent demand notice was sent via email on August 17, 2019, to the Corporate Debtor's official email address, but no reply was received. Kumar Brother Enterprises claimed that no operational debt was due

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## Issues and analysis

### Issue 1: Whether there is an 'Operational Debt' due from the Corporate Debtor to the Operational Creditor …

**Ratio:** An 'Operational Debt' is defined under Section 5(21) of the Insolvency and Bankruptcy

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**Reasoning:** The NCLT found that Bansal Industries had supplied metal sheets and water tank structures

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**Interpretation:** The definition of 'Operational Debt' is interpreted broadly to include any debt

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**Application:** In this case, the NCLT applied the definition of 'Operational Debt' to the

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## Parties

- **Judges:** Rajasekha…; Balraj…
- **Appellants:** Bansal Indu…
- **Respondents:** Kumar Brother…

## Timeline

- **2019-07-15 — Demand N…**: Operational Creditor sent a demand notice to the Corporate Debtor under section 8 of the…
- **2019-08-17 — Demand Notice…**: Operational Creditor sent a demand…

## 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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