# In the matter of Sanwariya Furnaces Pvt. Ltd.

> NCLT judgment dated 2022-07-28. Citation: TCN-2022-NCLT-01537. The application was filed by Mr. Vikas Maheshwari, Proprietor of M/s. Vikas Trading Company, an…

- **Court:** NCLT
- **Order date:** 28 Jul 2022
- **Citation:** TCN-2022-NCLT-01537
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sanwariya-furnaces-pvt-ltd-06d3fec6

## Summary

### Background

The application was filed by Mr. Vikas Maheshwari, Proprietor of M/s. Vikas Trading Company, an operational creditor, under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP) against M/s. Sanwariya Furnaces Pvt. Ltd., the corporate debtor. The operational creditor claimed non-payment of operational dues amounting to Rs. 1,84,85,231/-, inclusive of interest at 18% per annum. The applicant sold iron scrap to the corporate debtor through various invoices, with a principal amount of Rs. 1,56,65,450/- due.

## Facts

Mr. Vikas Maheshwari, proprietor of M/s. Vikas Trading Company, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against M/s. Sanwariya Furnaces Pvt. Ltd. The applicant, an operational creditor, claimed that the corporate debtor defaulted on payments for iron scrap sold through various invoices, amounting to Rs. 1,84,85,231/-, including interest at 18% per annum. The principal amount due was Rs. 1,56,65,450/-. A demand notice was issued on 2021-01-29 under Section 8 of the Code. The corporate debtor acknowledged the debt in its reply dated 2022-05-09 but cited financial difficulties due to the pandemic and requested an extension of time to repay. The date of default was 2021-09-13.

## Issues and analysis

### Issue 1: Whether the conditions under Section 9 of the Insolvency and Bankruptcy Code, 2016, are satisfied …

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

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**Reasoning:** The Adjudicating Authority observed that the corporate debtor failed to pay the amount

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

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**Application:** In this case, the Adjudicating Authority found that the corporate debtor had

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## Parties

- **Judges:** Deep Chandr…; Prasanta Kumar…
- **Appellants:** Sh. Vikas…
- **Respondents:** Sanwariya…; M/s. Sanwariya…
- **Advocates:** Dhrubajit…; Sachin Ag…; +1 more

## Timeline

- **2021-01-29 — Demand Notice…**: The Applicant issued a demand notice to the…
- **2021-02-17 — Demand Notice…**: The demand notice was served on the…

## 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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