# In the matter of OC Specialities Private Limited

> NCLT judgment dated 2023-10-31. Citation: TCN-2023-NCLT-00958. M/s Paras Sales Corporation filed a company petition against M/s OC Specialities Private…

- **Court:** NCLT
- **Order date:** 31 Oct 2023
- **Citation:** TCN-2023-NCLT-00958
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/oc-specialities-private-limited-5d7c95f9

## Summary

### Background

M/s Paras Sales Corporation filed a company petition against M/s OC Specialities Private Limited, seeking to initiate Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016. The petitioner alleged that the corporate debtor defaulted in making payment of Rs. 1,46,61,972/- for goods supplied. The corporate debtor denied the claim, alleging a pre-existing dispute based on bribery and substandard goods.

## Facts

M/s Paras Sales Corporation (Operational Creditor) claimed that M/s OC Specialities Private Limited (Corporate Debtor) defaulted on a payment of Rs. 1,46,61,972/- for goods supplied. The Operational Creditor supplied goods to the Corporate Debtor since April 2022, raising tax-paid invoices. The Corporate Debtor made some payments but stopped after June 2022. The Corporate Debtor sent a legal notice in October 2022 alleging bribery by the Operational Creditor. The Operational Creditor denied the bribery allegations and served a demand notice in November 2022. The Corporate Debtor claimed the goods supplied were substandard and that the Operational Creditor's employees paid bribes to the Corporate Debtor's employees. The Corporate Debtor filed a police complaint against

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## Issues and analysis

### Issue 1: Whether there is a pre-existing dispute between the parties that would preclude the admission of …

**Ratio:** The existence of a genuine pre-existing dispute is a bar to the admission of a petition

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**Reasoning:** The court reasoned that the Corporate Debtor had raised a dispute regarding bribery and

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**Interpretation:** The interpretation of 'pre-existing dispute' requires the court to determine

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**Application:** In this case, the court applied the ratio by finding that the Corporate Debtor

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## Parties

- **Judges:** Kuldip Kumar…; ANIL RAJ C…
- **Appellants:** M/s Paras Sales…
- **Respondents:** M/s OC Specialitie…

## Timeline

- **2022-04-01 — Supply of…**: The Petitioner started supplying…
- **2022-06-01 — Payment D…**: The Corporate Debtor stopped…

## 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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