# In the matter of Specific Alloys Private Limited

> NCLT judgment dated 2023-07-27. Citation: TCN-2023-NCLT-02311. The case involves a petition filed by Poona Petroleum Company Private Limited (Operational…

- **Court:** NCLT
- **Order date:** 27 Jul 2023
- **Citation:** TCN-2023-NCLT-02311
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/specific-alloys-private-limited-98cba071

## Summary

### Background

The case involves a petition filed by Poona Petroleum Company Private Limited (Operational Creditor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Specific Alloys Private Limited (Corporate Debtor). The Operational Creditor claims that the Corporate Debtor failed to pay an outstanding amount of INR 1,54,39,696/- for furnace oil supplied. The Corporate Debtor acknowledged the debt but cited financial difficulties and operational issues, including environmental concerns raised by the Gram Panchayat, as reasons for its inability to pay.

## Facts

Poona Petroleum Company Private Limited (Operational Creditor) filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Specific Alloys Private Limited (Corporate Debtor). The Operational Creditor claimed an outstanding debt of INR 1,54,39,696/- for furnace oil supplied to the Corporate Debtor. This amount includes a principal of Rs. 72,99,267/- and interest of Rs. 83,40,429/- accrued up to 31.12.2022. The date of default is 02.09.2022. The Corporate Debtor acknowledged the debt in its statement of Confirmation of Accounts dated 01.01.2023 and had issued a letter dated 25/07/2022 requesting the Operational Creditor not to take legal action, promising payment in three tranches over

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor committed a default in …

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

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**Reasoning:** The Corporate Debtor acknowledged the debt and failed to make payments as per the agreed

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**Interpretation:** The term 'default' under the IBC is interpreted as non-payment of debt when it

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**Application:** The Corporate Debtor's acknowledgment of the debt and failure to adhere to the

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## Parties

- **Judges:** H.V. Subb…; Anu Jagmoha…
- **Appellants:** Poona Petroleum…
- **Respondents:** Specific Alloys…

## Timeline

- **2020-05-23 — Incorporation of…**: Specific Alloys Private Limited was…
- **2022-07-25 — Corporate Debtor's…**: The Corporate Debtor addressed a letter to the Operational Creditor requesting them not…

## 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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