# In the matter of Prithviraj Plastics Private Limited CP (IB) No. 750-MB-IV-2021

> NCLT judgment dated 2023-05-09. Citation: TCN-2023-NCLT-03424. Laxmi Organic Industries Limited, the Operational Creditor/Applicant, filed an application…

- **Court:** NCLT
- **Order date:** 9 May 2023
- **Citation:** TCN-2023-NCLT-03424
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/prithviraj-plastics-private-limited-cp-ib-no-750-mb-iv-2021-62c2bb87

## Summary

### Background

Laxmi Organic Industries Limited, the Operational Creditor/Applicant, filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016 (I&B Code) to initiate Corporate Insolvency Resolution Process (CIRP) against Prithviraj Plastics Private Limited, the Corporate Debtor. The operational creditor claimed a total amount of Rs. 4,42,61,918, which includes a principal amount of Rs. 3,00,00,000 and interest of Rs. 1,42,61,918 accrued until July 25, 2021, at a rate of 18% per annum. The default date was 10.02.2019, the date by which repayment of the advance payment should have been made if the goods were not supplied. The applicant, Laxmi Organic Industries, is engaged in manufacturing specialty chemicals and entered into a Supply Agreement with

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## Facts

Laxmi Organic Industries Limited (Operational Creditor) filed an application under Section 9 of the Insolvency & Bankruptcy Code, 2016, to initiate CIRP against Prithviraj Plastics Private Limited (Corporate Debtor). The claim was for Rs. 4,42,61,918, including a principal of Rs. 3,00,00,000 and interest. The default date was 10.02.2019. Laxmi Organic Industries is a specialty chemicals manufacturer. They entered into a Supply Agreement with Prithviraj Plastics and Shri Saikrupa Sugar & Allied Industries Limited, where Prithviraj Plastics was to supply 10,00,000 liters of Rectified Spirit or Specially Denatured Spirit by January 2019 at Rs. 31 per liter. Laxmi Organic Industries made an advance payment of Rs. 3,00,00,000. The Corporate Debtor failed to supply

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the Insolvency & …

**Ratio:** Section 9 of the Insolvency & Bankruptcy Code, 2016 allows an operational creditor to

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**Reasoning:** The court considered the evidence presented by the Operational Creditor, including the

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**Interpretation:** Section 9 provides a mechanism for operational creditors to recover their dues

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**Application:** The court applied Section 9 to the facts of the case, finding that Laxmi

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## Parties

- **Judges:** Prabhat…; KISHORE VEMULAPALL…
- **Appellants:** LAXMI ORGANIC…
- **Respondents:** Prithviraj…

## Timeline

- **2018-12-04 — Supply Agr…**: Laxmi Organic Industries entered into a Supply Agreement with Prithviraj Plastics and…
- **2019-01-01 — Delivery Sc…**: The Corporate Debtor agreed to sell/supply 10,00,000 (Ten Lakh) litres of Rectified…

## 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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