# In the matter of SNS Starch Ltd. CP (IB) No.663-9-HDB-2019

> NCLT judgment dated 2022-03-22. Citation: TCN-2022-NCLT-03613. The case involves an application filed by Swamy Traders, an operational creditor, against SNS…

- **Court:** NCLT
- **Order date:** 22 Mar 2022
- **Citation:** TCN-2022-NCLT-03613
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sns-starch-ltd-cp-ib-no663-9-hdb-2019-887225e5

## Summary

### Background

The case involves an application filed by Swamy Traders, an operational creditor, against SNS Starch Ltd, the corporate debtor, under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016. Swamy Traders claimed that SNS Starch Ltd. defaulted on a payment of Rs. 3,83,23,524/-, which included principal and interest calculated up to 02.07.2019, for maize supplied. The operational creditor sought initiation of the Corporate Insolvency Resolution Process (CIRP), a moratorium, and appointment of an Interim Resolution Professional (IRP). The corporate debtor contested the claim, alleging disputes over the quality of maize, limitation, and the absence of a formal purchase order.

## Facts

Swamy Traders, an operational creditor, filed a petition against SNS Starch Ltd, a corporate debtor, under Section 9 of the IBC, claiming a default of Rs. 3,83,23,524/- (including interest). The debt arose from the supply of maize by Swamy Traders to SNS Starch Ltd. The operational creditor submitted invoices, bank statements, and ledger accounts as evidence of the debt and default. SNS Starch Ltd. contested the claim, alleging that the maize supplied was of substandard quality, that the claim was barred by limitation, and that there was no formal purchase order. The corporate debtor also claimed to have filed a recovery suit in the Commercial Court at Hyderabad prior to the demand notice. Swamy Traders argued that the corporate debtor had made part payments,

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## Issues and analysis

### Issue 1: Whether the documentary evidence furnished with the application shows that the operational debt is …

**Ratio:** The ratio is based on the interpretation of Section 9 of the IBC, which requires the

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**Reasoning:** The NCLT relied on the invoices, bank statements, and ledger accounts submitted by the

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**Interpretation:** The court interpreted Section 9 of the IBC and the Supreme Court's rulings to

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**Application:** The court applied the ratio to the facts of the case, finding that the

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. VEERA BRAHMA…
- **Appellants:** Swamy Tr…
- **Respondents:** SNS Starc…

## Timeline

- **2019-07-02 — Interest Calculation…**: Interest calculated up to this date…
- **2019-07-15 — Demand Notice…**: Swamy Traders issued a demand…

## 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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