# In the matter of Sreesai Trading India Private Limited IBA-849-2020

> NCLT judgment dated 2022-07-22. Citation: TCN-2022-NCLT-01598. The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 22 Jul 2022
- **Citation:** TCN-2022-NCLT-01598
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sreesai-trading-india-private-limited-iba-849-2020-d0a2309b

## Summary

### Background

The case involves an application filed under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016 by M/s. Sha Kantilal Jayantilal, the Operational Creditor, against M/s. Sreesai Trading India Private Limited, the Corporate Debtor, seeking initiation of the Corporate Insolvency Resolution Process (CIRP). The Operational Creditor claimed a total outstanding amount of Rs. 18,15,234/-, including principal and interest, for the supply of Basmati Rice. The Corporate Debtor admitted its liability but sought time to settle the matter, citing the Covid-19 pandemic and market vagrancies as reasons for its inability to pay.

## Facts

M/s. Sha Kantilal Jayantilal, the Operational Creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, against M/s. Sreesai Trading India Private Limited, the Corporate Debtor. The Operational Creditor claimed an outstanding amount of Rs. 18,15,234/-, comprising a principal amount of Rs. 15,33,875/- and interest of Rs. 2,81,359/-, for the supply of Basmati Rice during May-June 2018. The Operational Creditor issued invoices for the supplied goods. The Corporate Debtor allegedly failed to pay the outstanding amount despite repeated reminders. A Statutory Demand Notice under Section 8 of IBC, 2016, was issued to the Corporate Debtor on 09.08.2017 and received by them. The Corporate Debtor did not raise any objection to the demand

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## Issues and analysis

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

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

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**Reasoning:** The Tribunal considered the submissions of both parties and examined the documents

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**Interpretation:** Section 9 provides the mechanism for operational creditors to recover their

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**Application:** The Tribunal found that the Operational Creditor had demonstrated the existence

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## Parties

- **Judges:** S. Ramath…; SAMEER…
- **Appellants:** Sha Kantilal…
- **Respondents:** Sreesai Trading…

## Timeline

- **2018-05-01 — Supply of Basm…**: Operational Creditor supplied Basmati Rice to the Corporate Debtor during May and June…
- **2018-07-01 — Default in…**: The Corporate Debtor defaulted in paying the…

## 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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