# In the matter of Meenakshi Ferro Ingots Pvt. Ltd.

> NCLT judgment dated 2023-12-12. Citation: TCN-2023-NCLT-00283. Kreate Energy (I) Pvt. Ltd. filed an application under Section 9 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 12 Dec 2023
- **Citation:** TCN-2023-NCLT-00283
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/meenakshi-ferro-ingots-pvt-ltd-0200c125

## Summary

### Background

Kreate Energy (I) Pvt. Ltd. filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against Meenakshi Ferro Ingots Pvt. Ltd. to initiate Corporate Insolvency Resolution Process (CIRP) due to a default in payment of Rs. 36,02,275/-. The dispute arose from a Power Purchase Agreement (PPA) signed on 22.12.2015, where Kreate Energy was to supply electricity to Meenakshi Ferro. The core issue revolves around transmission charges, with Meenakshi Ferro claiming these were included in the agreed tariff and were directly paid to MSEDCL, while Kreate Energy argued they were not. The application was filed on 17.12.2019.

## Facts

Kreate Energy (I) Pvt. Ltd. (Operational Creditor) and Meenakshi Ferro Ingots Pvt. Ltd. (Corporate Debtor) entered into a Power Purchase Agreement (PPA) on 22.12.2015 for electricity supply. The PPA was amended multiple times in 2016. A dispute arose regarding the payment of transmission charges. Kreate Energy claimed that Meenakshi Ferro defaulted on payments amounting to Rs. 36,02,275/-. Meenakshi Ferro contended that the agreed tariff included transmission charges, which they paid directly to MSEDCL and adjusted against Kreate Energy's invoices. A reconciliation of accounts was attempted on 19.04.2017. Kreate Energy sent a legal demand notice on 02.07.2018. Meenakshi Ferro responded on 25.01.2019, raising objections. Kreate Energy filed a Section 9 application on

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## Issues and analysis

### Issue 1: Whether a pre-existing dispute existed between Kreate Energy (I) Pvt. Ltd. and Meenakshi Ferro …

**Ratio:** The existence of a pre-existing dispute, as defined under Section 5(6) of the IBC, bars

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**Reasoning:** The NCLT found that the dispute regarding transmission charges was evident from the email

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**Interpretation:** The interpretation of Section 5(6) and Section 9 of the IBC, as clarified by

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**Application:** In this case, the NCLT applied the Mobilox Innovations precedent and found that

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## Parties

- **Judges:** Ashish…; Praveen…
- **Appellants:** Kreate Energy (I)…
- **Respondents:** M/s Meenakshi…
- **Advocates:** Sh. Ujjawal…; Sh. Tarun…

## Timeline

- **2015-12-22 — Power Purchase…**: Kreate Energy (I) Pvt. Ltd. and Meenakshi Ferro Ingots Pvt. Ltd. entered into a Power…
- **2016-01-01 — PPA Amend…**: The PPA was amended…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 8 — Insolvency resolution by operational creditor](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-8)

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