# In the matter of Omkar Speciality Chemical Limited IA 1521-2022 In C.P. (IB)-1738(MB)2017

> NCLT judgment dated 2022-12-05. Citation: TCN-2022-NCLT-00238. The case involves an application (IA 1521/2022) for the revival of a Company Petition…

- **Court:** NCLT
- **Order date:** 5 Dec 2022
- **Citation:** TCN-2022-NCLT-00238
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/omkar-speciality-chemical-limited-ia-1521-2022-in-cp-ib-1738mb2017-b1e8166f

## Summary

### Background

The case involves an application (IA 1521/2022) for the revival of a Company Petition (IB)/1738(MB)2017 filed under Rule 11 of NCLT Rules, 2016. The original petition was for the initiation of Corporate Insolvency and Bankruptcy Code (CIRP) for a claim of Rs. 1,61,81,246/-. The Corporate Debtor and Operational Creditor had previously entered into a settlement agreement, with liberty granted to the Operational Creditor via an order dated 13.03.2020.

## Facts

M/s. Ela Enterprise, the Operational Creditor, filed a Company Petition (IB)/1738(MB)2017 seeking initiation of CIRP against Omkar Speciality Chemical Limited, the Corporate Debtor, for a claim of Rs. 1,61,81,246/-. The parties had entered into a settlement agreement, and the Operational Creditor was granted liberty via an order dated 13.03.2020. However, the Corporate Debtor allegedly failed to pay the first installment as per the settlement terms. Consequently, the Operational Creditor filed IA No. 1521 of 2022 for the revival of the Company Petition. The Corporate Debtor admitted its inability to pay the outstanding amount. The relevance of these facts lies in establishing the grounds for reviving the CIRP process, specifically the breach of the settlement agreement

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## Issues and analysis

### Issue 1: Whether the Company Petition (IB)/1738(MB)2017 should be revived and CIRP initiated against Omkar …

**Ratio:** The legal principle applied is that if a corporate debtor defaults on its obligations,

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**Reasoning:** The court reasoned that the Corporate Debtor's failure to pay the first installment of

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**Interpretation:** The interpretation is that a settlement agreement does not preclude the revival

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**Application:** The ratio and reasoning are applied to the specific facts by reviving the

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## Parties

- **Judges:** P.N. Des…; Shyam Babu…
- **Respondents:** Omkar Speciality…

## Timeline

- **2017-01-01 — Company Petiti…**: M/s. Ela Enterprise filed Company Petition…
- **2020-03-13 — Order Granting…**: Order dated 13.03.2020 granted liberty to the Operational Creditor in relation to a…

## 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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