# In the matter of Neocortex Life Sciences Private Limited

> NCLT judgment dated 2024-02-13. Citation: TCN-2024-NCLT-02613. The case pertains to an application filed by Neocortex Life Sciences Private Limited under…

- **Court:** NCLT
- **Order date:** 13 Feb 2024
- **Citation:** TCN-2024-NCLT-02613
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/neocortex-life-sciences-private-limited-1b08f6a3

## Summary

### Background

The case pertains to an application filed by Neocortex Life Sciences Private Limited under Section 10 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) in its own capacity as the Corporate Applicant. The company states that it is unable to pay its debts due to bad marketing conditions leading to a liquidity crunch. The company is engaged in the business of importing, manufacturing, and selling health supplements, cosmetics, and other related products. The application was filed before the National Company Law Tribunal (NCLT), Hyderabad Bench.

## Facts

Neocortex Life Sciences Private Limited filed an application under Section 10 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate Corporate Insolvency Resolution Process (CIRP). The company is engaged in importing, manufacturing, and selling health supplements, cosmetics, and related products. The company claimed it defaulted in paying creditors due to bad marketing conditions, leading to a liquidity crunch. As of 31.07.2023, the company had assets worth Rs 87,30,119 against outstanding liabilities of Rs 3,09,82,635. The company has two shareholders: Mr. Saroj Kumar Patnaik holding 99.99% and Mrs. Sarada Lakshmi Rallabhandi holding 00.01% share. The shareholders passed a resolution for initiating CIRP under Section 10 of IBC in an Extra Ordinary General

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## Issues and analysis

### Issue 1: Whether the application filed by Neocortex Life Sciences Private Limited under Section 10 of the …

**Ratio:** Section 10 of the Insolvency and Bankruptcy Code (IBC), 2016, allows a corporate

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**Reasoning:** The NCLT considered the Corporate Applicant's stated inability to pay its debts due to

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**Interpretation:** Section 10 of the IBC allows a corporate debtor to initiate CIRP if it is

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**Application:** The NCLT applied Section 10 of the IBC to the facts of the case, noting that

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## Parties

- **Judges:** Rajeev Bh…; Sanjay…
- **Respondents:** Neocortex Life…
- **Advocates:** M. Maharshi…

## Timeline

- **2023-07-22 — Extra Ordinary General…**: Shareholders passed a resolution for…
- **2023-07-31 — Statement of…**: Corporate Applicant had assets worth Rs 87,30,119 against outstanding liabilities of Rs…

## 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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