# In the matter of P. M. Garments Exports Private Limited C.P. (IB) No. 583-KB-2020

> NCLT judgment dated 2022-06-07. Citation: TCN-2022-NCLT-02358. The case originates from a Company Petition filed under Section 9 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 7 Jun 2022
- **Citation:** TCN-2022-NCLT-02358
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/p-m-garments-exports-private-limited-cp-ib-no-583-kb-2020-06a31917

## Summary

### Background

The case originates from a Company Petition filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, by Rajesh Kumar Parasrampuria, the proprietor of Utex Corporation (Operational Creditor), against P.M. Garments Exports Private Limited (Corporate Debtor). The Operational Creditor claimed that the Corporate Debtor failed to pay a sum of Rs. 17,01,424/-. The date of default was 09 September, 2019. The Operational Creditor had supplied cotton hosiery yarn to the Corporate Debtor and raised invoices, against which part payments were made, leaving the outstanding amount.

## Facts

Rajesh Kumar Parasrampuria, proprietor of Utex Corporation, filed a Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, against P.M. Garments Exports Private Limited. Utex Corporation, the Operational Creditor, claimed that P.M. Garments Exports Private Limited, the Corporate Debtor, defaulted on a payment of Rs. 17,01,424/-. The default date was 09 September, 2019. The Operational Creditor supplied cotton hosiery yarn to the Corporate Debtor, raising nine invoices totaling Rs. 47,65,551/-, of which Rs. 30,64,127/- was paid, leaving Rs. 17,01,424/- outstanding. The Operational Creditor issued a statutory notice dated 03 February, 2020, which was delivered on 06 February, 2020. The Corporate Debtor failed to clear the outstanding dues and did

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor is in default of a debt …

**Ratio:** Section 4(1) of the Code stipulates a minimum default amount of Rupees one lakh for

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**Reasoning:** The Adjudicating Authority found that the Corporate Debtor had defaulted on a debt

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**Interpretation:** Section 4(1) sets the threshold for triggering the insolvency resolution

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**Application:** The outstanding amount of Rs. 17,01,424/- exceeded the minimum threshold, and

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## Parties

- **Judges:** Rajasekha…; Balraj…
- **Appellants:** Rajesh Kumar…
- **Respondents:** P.M. Garments…
- **Advocates:** Pankaj Ag…

## Timeline

- **2019-09-09 — Date of D…**: The Corporate Debtor defaulted on a payment of Rs. 17,01,424/- to the Operational…
- **2020-02-03 — Statutory…**: The Operational Creditor issued a statutory notice to the Corporate Debtor under section…

## 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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