# In the matter of Spectra Fashions Private Limited C.P. (IB)-115(KB)2021

> NCLT judgment dated 2023-02-21. Citation: TCN-2023-NCLT-04507. Aarti International Limited, the Operational Creditor, filed a Company Petition under Section 9…

- **Court:** NCLT
- **Order date:** 21 Feb 2023
- **Citation:** TCN-2023-NCLT-04507
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/spectra-fashions-private-limited-cp-ib-115kb2021-749a6251

## Summary

### Background

Aarti International Limited, the Operational Creditor, filed a Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Spectra Fashions Private Limited, the Corporate Debtor. The Operational Creditor claimed a default amount of Rs.1,21,48,714/- as of February 15, 2019, with interest at 18% per annum, with the date of default stated as November 26, 2018. The Corporate Debtor disputed the existence of the debt, claiming no outstanding debts were due and payable and that all allegations in the demand notices were denied.

## Facts

Aarti International Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Spectra Fashions Private Limited (Corporate Debtor). The Operational Creditor claimed a default of Rs.1,21,48,714/- as of February 15, 2019, with 18% interest, the default date being November 26, 2018. The Operational Creditor is in the business of manufacturing and exporting yarn and fabrics, and supplied fabrics to the Corporate Debtor based on orders placed by the Corporate Debtor's directors. The Corporate Debtor made payments from time to time, but no payments were received against bills raised from November 26, 2018, to July 17, 2019. A statutory demand notice under

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor is in default of a debt …

**Ratio:** The principle that if a debt is admitted to be due and payable, and a default has

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**Reasoning:** The court noted that the Corporate Debtor's counsel admitted that the Operational Debt

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**Interpretation:** The interpretation of 'acknowledgment of debt' includes any communication or

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**Application:** In this case, the Corporate Debtor's attempt to reach a settlement and the

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## Parties

- **Judges:** RohitKa…; Balraj…
- **Appellants:** Aarti Internationa…
- **Respondents:** Spectra Fashions…

## Timeline

- **2018-11-26 — Date of D…**: The date on which the Corporate Debtor is…
- **2019-02-15 — Amount Cl…**: The Operational Creditor claims a default…

## 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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