# In the matter of Vastrani Export Pvt. Ltd.

> NCLT judgment dated 2024-01-01. Citation: TCN-2024-NCLT-03378. The case arises from commercial transactions between Star Synthetics Pvt. Ltd.…

- **Court:** NCLT
- **Order date:** 1 Jan 2024
- **Citation:** TCN-2024-NCLT-03378
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vastrani-export-pvt-ltd-6cacd5b7

## Summary

### Background

The case arises from commercial transactions between Star Synthetics Pvt. Ltd. (Applicant/Operational Creditor) and Vastrani Export Pvt. Ltd. (Corporate Debtor). The Applicant supplied fabric to the Corporate Debtor, who defaulted on payments against 61 invoices totaling Rs. 2,44,38,661/-. The default commenced in May 2022. The Applicant issued a demand notice under Section 8(1) of the IBC, 2016, which the Corporate Debtor did not respond to. The Corporate Debtor failed to file any reply despite being granted opportunities.

## Facts

Star Synthetics Pvt. Ltd. (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, against Vastrani Export Pvt. Ltd. (Corporate Debtor) for defaulting on payments. The Corporate Debtor is engaged in the business of manufacturing and trading garments, specifically ladies' garments, and required Greige fabric for manufacturing printed garments. The Operational Creditor supplied fabric to the Corporate Debtor, and invoices were raised regularly. The Corporate Debtor defaulted in making payments against 61 invoices amounting to Rs. 2,44,38,661/- from May 2022. The Operational Creditor issued a demand notice dated 26/04/2023 under Section 8(1) of the IBC, 2016, which was sent to the Corporate Debtor on 27/04/2023. The

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## Issues and analysis

### Issue 1: Whether the application filed by the Operational Creditor under Section 9 of the IBC, 2016, is …

**Ratio:** Section 9 of the IBC, 2016, allows an operational creditor to initiate CIRP against a

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**Reasoning:** The court noted that the Corporate Debtor had defaulted in making payments against 61

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

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**Application:** The court found that the Operational Creditor had established the existence of

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## Parties

- **Judges:** SH. ASHOK KUMAR…; SH. SUBRATA KUMAR…
- **Appellants:** Star Synthetics…
- **Respondents:** Vastrani Export…

## Timeline

- **2022-05-01 — Default Com…**: The Corporate Debtor defaulted in making…
- **2023-04-26 — Demand Notice…**: The Operational Creditor 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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