# In the matter of Rich Fruits Private Limited I.A NO. 269-2022 in C.P (IB) No. 26-BB-2021

> NCLT judgment dated 2023-06-23. Citation: TCN-2023-NCLT-02824. The Resolution Professional of Rich Fruits Private Limited, acting as the Corporate Debtor,…

- **Court:** NCLT
- **Order date:** 23 Jun 2023
- **Citation:** TCN-2023-NCLT-02824
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rich-fruits-private-limited-ia-no-269-2022-in-cp-ib-no-26-bb-2021-dfc3cb4b

## Summary

### Background

The Resolution Professional of Rich Fruits Private Limited, acting as the Corporate Debtor, filed an application under Section 66 of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of the NCLT Rules, 2016. The application sought to declare certain identified transactions as fraudulent and direct Respondents 1 to 3 to contribute a sum of Rs. 6,03,30,643.37 to the assets of the Corporate Debtor. The Corporate Debtor had supplied goods to Safa Fruits and SMGK Agro Products but had not recovered the dues. The applicant observed a significant difference between the amounts accounted for in the ledger statements and the invoices provided by the promoter directors. The Corporate Debtor's accounts did not accurately reflect the true state of affairs.

## Facts

The Resolution Professional (RP) of Rich Fruits Private Limited filed an application under Section 66 of the Insolvency and Bankruptcy Code, 2016, seeking to declare certain transactions as fraudulent. The Corporate Debtor, Rich Fruits Private Limited, underwent CIRP initiated on 2022-02-02. The RP, acting as liquidator, alleged that the Corporate Debtor had supplied goods to Safa Fruits and SMGK Agro Products, but a significant amount of Rs. 6,03,30,643.37/- remained unrecovered. The RP claimed that the ledger statements and invoices showed discrepancies, indicating fraudulent transactions. The respondents, including Mr. Abdul Asif, Mr. Abdul Sattar, and Mr. Amirjan Nasimunisa, contested the allegations, stating that the transactions were commercial decisions and

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## Issues and analysis

### Issue 1: Whether the transactions between the Corporate Debtor and Safa Fruits and SMGK Agro Products were …

**Ratio:** Section 66 of the IBC, 2016, deals with fraudulent or wrongful trading. It requires that

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**Reasoning:** The Adjudicating Authority found that the applicant failed to prove that the respondents

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**Interpretation:** Section 66 requires proof of intent to defraud creditors and knowing

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**Application:** In this case, the applicant failed to provide sufficient evidence to prove that

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## Parties

- **Judges:** (Retd.) T.…; Manoj Kumar…
- **Appellants:** Hari Babu…
- **Respondents:** Rich Fruits…; Abdul…

## Timeline

- **2022-02-02 — CIRP Init…**: CIRP process of the…
- **2022-05-20 — CoC Meet…**: Liquidation of the Corporate Debtor approved along with the appointment of the RP as the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 66 — Fraudulent trading or wrongful trading](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-66)

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