# In the matter of Vidharva Trading Private Limited Company Petition No. (IB)-720-(ND)-2022

> NCLT judgment dated 2022-12-23. Citation: TCN-2022-NCLT-00023. The case originates from an application filed by M/s. Montage Enterprises Private Limited, the…

- **Court:** NCLT
- **Order date:** 23 Dec 2022
- **Citation:** TCN-2022-NCLT-00023
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vidharva-trading-private-limited-company-petition-no-ib-720-nd-2022-14427293

## Summary

### Background

The case originates from an application filed by M/s. Montage Enterprises Private Limited, the operational creditor, 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 Corporate Insolvency Resolution Process (CIRP) against M/s. Vidharva Trading Private Limited, the corporate debtor, for defaulting on a payment of Rs. 41,14,77,820.40/-, which includes a principal amount of Rs. 40,88,48,937/- and interest amounting to Rs. 26,28,883.40/- at 18% per annum on the outstanding principal amount. The corporate debtor had entered into a 'Goods Sale and Purchase Agreement' with the operational creditor on 19.09.2019, and allegedly defaulted on

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## Facts

M/s. Montage Enterprises Private Limited (Operational Creditor) filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Vidharva Trading Private Limited (Corporate Debtor). The application was based on a default in payment of Rs. 41,14,77,820.40/-, including a principal amount of Rs. 40,88,48,937/- and interest of Rs. 26,28,883.40/- at 18% per annum. The Operational Creditor and Corporate Debtor had entered into a 'Goods Sale and Purchase Agreement' dated 19.09.2019. The Operational Creditor supplied goods to the Corporate Debtor, raising invoices for the same. The Corporate Debtor allegedly defaulted on payments for invoices from 25.01.2022 to 23.08.2022. The Operational

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## Issues and analysis

### Issue 1: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016 is complete and …

**Ratio:** Section 9(5) of the IBC mandates that the Adjudicating Authority shall admit the

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**Reasoning:** The Adjudicating Authority considered the facts of the case, the submissions of both

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**Interpretation:** Section 9 of the IBC provides a mechanism for operational creditors to initiate

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**Application:** In this case, the Adjudicating Authority found that the application was

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## Parties

- **Judges:** BACHU VENKAT…; ATUL CHAT…
- **Appellants:** M/s. Montage…
- **Respondents:** M/s. Vidharva…

## Timeline

- **2019-09-19 — Goods Sale and Purchase…**: M/s. Montage Enterprises Private Limited and M/s. Vidharva Trading Private Limited…
- **2022-01-25 — Default in P…**: M/s. Vidharva Trading Private Limited allegedly started making wilful default in payments…

## 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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