# In the matter of OHM Srinivasa Paper Boards Private Limited CP-IB-130(CHE)-2021

> NCLT judgment dated 2022-11-04. Citation: TCN-2022-NCLT-00532. The case involves an application filed by M/s. Pathy Enterprises, an operational creditor,…

- **Court:** NCLT
- **Order date:** 4 Nov 2022
- **Citation:** TCN-2022-NCLT-00532
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ohm-srinivasa-paper-boards-private-limited-cp-ib-130che-2021-01ec0ac9

## Summary

### Background

The case involves an application filed by M/s. Pathy Enterprises, an operational creditor, against M/s. Ohm Srinivasa Paper Boards Private Limited, the corporate debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016. The operational creditor sought to initiate the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor, declare a moratorium, and appoint an Interim Resolution Professional (IRP). The application was based on an alleged operational debt of Rs. 1,23,29,308/-, comprising principal and interest. The corporate debtor contested the application, arguing that payments had been made, reducing the debt below the threshold for initiating CIRP, and that the nature of the debt had changed due to a Memorandum of Understanding (MoU)

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## Facts

M/s. Pathy Enterprises, an operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, against M/s. Ohm Srinivasa Paper Boards Private Limited, a corporate debtor. The operational creditor claimed an operational debt of Rs. 1,23,29,308/-, including principal and interest. The last invoice date was 03.02.2020. The corporate debtor argued that payments made after a Memorandum of Understanding (MoU) dated 28.12.2019 reduced the debt below the statutory threshold of Rs. 1,00,00,000/-. The corporate debtor also contended that the nature of the debt had changed to a non-recourse basis due to the MoU. The operational creditor supplied raw materials to the corporate debtor from 01.06.2018. The parties entered into an MoU on

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## Issues and analysis

### Issue 1: Whether the application filed by the operational creditor is maintainable under Section 9 of the …

**Ratio:** The application is not maintainable if the debt does not meet the statutory threshold as

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**Reasoning:** The NCLT considered the submissions and documents, finding that the outstanding debt,

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**Interpretation:** Section 9 of the IBC requires the operational debt to be above a certain

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**Application:** The court applied the principle that the debt must meet the threshold. Since

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## Parties

- **Judges:** DEEPTI M…; SAMEER…
- **Appellants:** M/s. Pathy…
- **Respondents:** M/s. Ohm Srinivasa…
- **Advocates:** T. Sri Krishna…; Srenik S.…; +4 more

## Timeline

- **2011-03-29 — Incorporation of…**: M/s. Ohm Srinivasa Paper Boards Private Limited incorporated under the Companies Act,…
- **2018-06-01 — Supply of Ma…**: M/s. Pathy Enterprises started supplying…

## 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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