# In the matter of My Own Eco Energy Private Limited CP (IB) 4377-MB-C-I-2019

> NCLT judgment dated 2022-10-21. Citation: TCN-2022-NCLT-00641. The case involves a petition filed by Suresh Tarachand Gundecha, an Operational Creditor, under…

- **Court:** NCLT
- **Order date:** 21 Oct 2022
- **Citation:** TCN-2022-NCLT-00641
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/my-own-eco-energy-private-limited-cp-ib-4377-mb-c-i-2019-b591ba55

## Summary

### Background

The case involves a petition filed by Suresh Tarachand Gundecha, an Operational Creditor, under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), seeking to initiate Corporate Insolvency Resolution Process (CIRP) against My Own Eco Energy Private Limited, the Corporate Debtor. The Corporate Debtor had taken a refundable security deposit of Rs. 15,00,000 from the Operational Creditor for providing a dealership of a retail outlet. The Corporate Debtor issued a letter of intent but did not issue an appointment letter or enter into a dealership agreement. The Operational Creditor demanded a refund of the security deposit, but the Corporate Debtor failed to refund it, leading to the filing of this petition.

## Facts

Suresh Tarachand Gundecha (Operational Creditor) filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against My Own Eco Energy Private Limited (Corporate Debtor). The Corporate Debtor took a refundable security deposit of Rs. 15,00,000 from the Operational Creditor for providing a dealership of a retail outlet at NH-14 Village Bagawas, Sojat Dist-Pali, Rajasthan. The Operational Creditor paid the security deposit via Demand Draft No. 751011 on SBBJ dated 23.09.2016, which was acknowledged by the Corporate Debtor. The Corporate Debtor confirmed that the outlet would be operational within 90 days from 24.09.2016 (date of issuance of letter of intent). However, the Corporate Debtor

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## Issues and analysis

### Issue 1: Whether the security deposit of Rs. 15,00,000 constitutes an operational debt under the Insolvency …

**Ratio:** A security deposit can be treated as an operational debt, especially when it is linked to

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**Reasoning:** The court relied on the NCLAT's decision, which stated that the payment of an

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**Interpretation:** The interpretation of 'operational debt' includes liabilities arising from

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**Application:** In this case, the security deposit was given for the purpose of obtaining a

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## Parties

- **Judges:** P.N. Des…; Shyam Babu…
- **Appellants:** Suresh Tarachand…
- **Respondents:** My Own Eco Energy…

## Timeline

- **2016-09-23 — Payment of Security…**: The Operational Creditor paid a refundable security deposit of Rs. 15,00,000 to the…
- **2016-09-24 — Letter of…**: The Corporate Debtor issued a letter of intent confirming that the retail outlet would be…

## 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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