# In the matter of SQ Infrastructure Private Limited

> NCLT judgment dated 2023-12-18. Citation: TCN-2023-NCLT-00175. This case involves an application filed by Quality Heightcon Private Limited (Operational…

- **Court:** NCLT
- **Order date:** 18 Dec 2023
- **Citation:** TCN-2023-NCLT-00175
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sq-infrastructure-private-limited-b56cc0e6

## Summary

### Background

This case involves an application filed by Quality Heightcon Private Limited (Operational Creditor - OC) under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against SQ Infrastructure Private Limited (Corporate Debtor - CD). The OC claimed a default of Rs. 13,23,88,147.00/- due to construction work done for the CD. The OC was appointed by the predecessor of the CD for the construction of the project "Sunshine Infinity".

## Facts

Quality Heightcon Private Limited (OC) filed an application under Section 9 of the IBC to initiate CIRP against SQ Infrastructure Private Limited (CD) for a default of Rs. 13,23,88,147.00/-. The OC was appointed by the predecessor of the CD for construction work on the 'Sunshine Infinity' project. The OC raised invoices from 31.03.2015 to 15.06.2021. The CD withheld 2.5% of the invoice amount as retention money. The OC issued a Demand Notice on 28.01.2022, which the CD acknowledged on 29.01.2022. The CD admitted to the claim amount but cited economic difficulties due to inflation and the COVID-19 pandemic. The CD made a partial payment of Rs. 10,00,000/- on 03.03.2022 but did not deposit TDS. The predecessor of the CD transferred the 'Sunshine Infinity Project' to the

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the IBC is …

**Ratio:** Section 9 of the IBC allows an operational creditor to initiate CIRP against a corporate

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**Reasoning:** The NCLT found that the date of default was 15.07.2021, and the application was filed on

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**Interpretation:** The application is maintainable if it is filed within the stipulated time frame

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**Application:** In this case, the application was filed within 3 years of the date of default,

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## Parties

- **Judges:** K. R. SAJI…; SANJIV…
- **Appellants:** Quality Heightcon…
- **Respondents:** SQ Infrastructure…

## Timeline

- **2009-06-20 — Work Order…**: The Corporate Debtor issued a Work Order to the Operational Creditor for the construction…
- **2011-03-24 — Work Order…**: The Corporate Debtor issued a Work Order to the Operational Creditor for the construction…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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