# In the matter of R-Brands Lifestyle Private Limited C.P. (IB) No. 544-IBC-MB-2020

> NCLT judgment dated 2023-05-02. Citation: TCN-2023-NCLT-03492. Dhaga Ghar Threads Private Limited filed a Company Petition under Section 9 of the Insolvency…

- **Court:** NCLT
- **Order date:** 2 May 2023
- **Citation:** TCN-2023-NCLT-03492
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/r-brands-lifestyle-private-limited-cp-ib-no-544-ibc-mb-2020-a69256c2

## Summary

### Background

Dhaga Ghar Threads Private Limited filed a Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against R-Brands Lifestyle Private Limited. The petitioner alleged that the corporate debtor defaulted on payments amounting to Rs. 6,28,672/- as of 13.12.2019, inclusive of interest at 24% p.a. The petition was filed due to outstanding payments for goods supplied by the petitioner to the corporate debtor.

## Facts

Dhaga Ghar Threads Private Limited (the Petitioner), an operational creditor, filed a petition against R-Brands Lifestyle Private Limited (the Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate CIRP. The Petitioner claimed that the Corporate Debtor defaulted on payments amounting to Rs. 6,28,672/- as of 13.12.2019, inclusive of interest at 24% p.a. The total amount of invoices for transactions was Rs. 8,48,910/-, out of which Rs. 4,58,977/- was paid. The unpaid principal was Rs. 3,89,933/-, and total interest was Rs. 2,38,738/- until 31.01.2020. The Petitioner issued a demand notice on 30.11.2019, which was received by the Corporate Debtor on 02.12.2019. The Corporate Debtor failed to make any further payments after

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor defaulted in repayment of the operational debt to the Petitioner, …

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

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**Reasoning:** The court observed that the Corporate Debtor had failed to make payments against 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, noting that the Corporate Debtor's

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## Parties

- **Judges:** Kuldip Kumar…; Prabhat…
- **Appellants:** Dhaga Ghar…
- **Respondents:** R-Brands Lifestyle…

## Timeline

- **2019-07-15 — Corporate Debtor Fails…**: The Corporate Debtor failed to make…
- **2019-11-30 — Demand Notice…**: The Petitioner issued a Demand Notice dated 30.11.2019 calling upon the Corporate Debtor…

## 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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