# In the matter of VGS Realty Construction Private Limited

> NCLT judgment dated 2024-08-14. Citation: TCN-2024-NCLT-00798. Life Construction Private Limited filed a Company Petition under Section 9 of the Insolvency…

- **Court:** NCLT
- **Order date:** 14 Aug 2024
- **Citation:** TCN-2024-NCLT-00798
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vgs-realty-construction-private-limited-687b007e

## Summary

### Background

Life Construction Private Limited filed a Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against VGS Realty Construction Private Limited. The operational debt claimed was Rs. 19,63,46,629/-, with the date of default being 15th March 2019. The Operational Creditor claimed to have provided construction services to the Corporate Debtor based on work orders, raising invoices between December 2014 and March 2019, totaling Rs. 78,57,01,345/-. The Corporate Debtor made partial payments, leaving a balance unpaid.

## Facts

Life Construction Private Limited (Operational Creditor) filed a petition against VGS Realty Construction Private Limited (Corporate Debtor) under Section 9 of the Insolvency and Bankruptcy Code, 2016, claiming an operational debt of Rs. 19,63,46,629/- with the date of default being 15th March 2019. The Operational Creditor provided construction services to the Corporate Debtor based on work orders, raising invoices between December 2014 and March 2019, totaling Rs. 78,57,01,345/-. The Corporate Debtor made partial payments of Rs. 55,99,97,609/-, leaving a balance unpaid. The Operational Creditor issued a Demand Letter on 15th March 2022, and a Demand Notice on 13th May 2022. The Corporate Debtor made a part payment of Rs. 75,00,000/- on 12th September 2022. The

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## Issues and analysis

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

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

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**Reasoning:** The NCLT found that the Operational Creditor had provided sufficient evidence to

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

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**Application:** The NCLT applied Section 9 to the facts of the case, finding that the

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## Parties

- **Judges:** Reeta K…; Madhu S…
- **Appellants:** Life Construction…
- **Respondents:** VGS Realty…

## Timeline

- **2014-12-01 — Invoice Perio…**: Invoices were raised…
- **2019-03-15 — Date of D…**: The date of default is…

## 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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