# In the matter of Sargam India Electronics Private Limited IB-549(ND)-2022

> NCLT judgment dated 2022-11-29. Citation: TCN-2022-NCLT-00293. M/s. Kumar Electronics, an operational creditor, filed an application under Section 9 of the…

- **Court:** NCLT
- **Order date:** 29 Nov 2022
- **Citation:** TCN-2022-NCLT-00293
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sargam-india-electronics-private-limited-ib-549nd-2022-a1ab7c2e

## Summary

### Background

M/s. Kumar Electronics, an operational creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. Sargam India Electronics Private Limited, the corporate debtor, for defaulting on a debt of Rs. 3,52,34,840/- along with interest of Rs. 76,40,098/-. The operational creditor and corporate debtor had frequent business dealings since 2010. The corporate debtor acknowledged its liability of Rs. 2,39,31,920/- as on 31.03.2022 and assured payment. The operational creditor issued a demand notice on 13.05.2022. The corporate debtor cited financial difficulties due to the Covid-19 pandemic and had also availed credit facilities from various banks.

## Facts

M/s. Kumar Electronics (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against M/s. Sargam India Electronics Private Limited (Corporate Debtor). The claim was for a debt of Rs. 3,52,34,840/- plus interest of Rs. 76,40,098/-, totaling Rs. 4,28,74,938/-. Frequent business dealings occurred between the parties since 2010. The Operational Creditor maintained a running account. The Corporate Debtor acknowledged a liability of Rs. 2,39,31,920/- as of 31.03.2022. A demand notice was issued on 13.05.2022. The Corporate Debtor cited financial difficulties due to the Covid-19 pandemic in 2020. The Corporate Debtor had availed credit facilities from Union Bank of India, ICICI Bank, State Bank of India, and

…

## Issues and analysis

### Issue 1: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016, for initiating …

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

…

**Reasoning:** The Adjudicating Authority considered the invoices attached to the application and the

…

**Interpretation:** Section 9 provides the mechanism for operational creditors to initiate CIRP.

…

**Application:** The Adjudicating Authority applied the provisions of Section 9 and Section 10A

…

## Parties

- **Judges:** SHRI. P.S.N.…; SHRI. RAHUL…
- **Appellants:** M/s. Kumar…
- **Respondents:** M/s. Sargam India…
- **Advocates:** Dhananjay…; Chaitanya…

## Timeline

- **2010-01-01 — Business Deali…**: Frequent business dealings commenced between the Operational Creditor and the Corporate…
- **2020-03-25 — Nationwide L…**: Government of India imposed a nationwide…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sargam-india-electronics-private-limited-ib-549nd-2022-a1ab7c2e