# In the matter of Nahorjan Tea Co. Pvt. Ltd. C.P (IB) No. 17-KB-2022

> NCLT judgment dated 2023-01-04. Citation: TCN-2023-NCLT-05198. This case involves an application under Section 9 of the Insolvency and Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 4 Jan 2023
- **Citation:** TCN-2023-NCLT-05198
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/nahorjan-tea-co-pvt-ltd-cp-ib-no-17-kb-2022-14895d52

## Summary

### Background

This case involves an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, filed by Mr. Mahavir Nimodia (Operational Creditor) against Nahorjan Tea Company Private Limited (Corporate Debtor) for initiation of Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed a default of Rs. 1,46,17,598 as of September 16, 2021, along with interest at 14% per annum, stemming from unpaid invoices for agrochemicals supplied to the Corporate Debtor. The Corporate Debtor acknowledged the debt but cited financial difficulties and requested time to work out a repayment schedule.

## Facts

Mr. Mahavir Nimodia, operating as Chemico House, is an Operational Creditor engaged in supplying agrochemicals, pesticides, insecticides, and bio-fertilizers. Nahorjan Tea Company Private Limited, the Corporate Debtor, is in the business of tea manufacturing. The Corporate Debtor approached the Operational Creditor for the supply of agrochemicals, placing various purchase orders. Goods were supplied through a transporter or collected by the Corporate Debtor's staff. Tax invoices were raised after each delivery and received by the Corporate Debtor. The Corporate Debtor made on-account payments, maintaining a running account. Despite repeated requests, the Corporate Debtor failed to make payments towards outstanding invoices. The date of the first default was July 13,

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## Issues and analysis

### Issue 1: Whether there is any default …

**Ratio:** Section 9 of the Insolvency and Bankruptcy Code, 2016 allows an operational creditor to

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**Reasoning:** The court found that the Corporate Debtor had failed to make payments for the supplied

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**Interpretation:** The term 'default' under the IBC is interpreted as non-payment of debt when it

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**Application:** The court applied the definition of default to the facts, noting the

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## Parties

- **Judges:** Rohit K…; Balraj…; +1 more
- **Appellants:** Mr.Mahavir…
- **Respondents:** Nahorjan Tea…
- **Advocates:** Sonal…; Aniket Cha…

## Timeline

- **2017-05-05 — Bills Ra…**: Bills were raised between 05…
- **2021-07-13 — Date of First…**: Date of the last supplies made,…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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