# In the matter of Transmission Corporation of Andhra Pradesh Limited Vs Equipment Conductors and Cables Limited Civil Appeal No.9597 -2018

> SC judgment dated 2018-10-23. Citation: TCN-2018-SC-00008. The case involves an appeal against an order of the National Company Law Appellate Tribunal (NCLAT)…

- **Court:** SC
- **Order date:** 23 Oct 2018
- **Citation:** TCN-2018-SC-00008
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/transmission-corporation-of-andhra-pradesh-limited-vs-equipment-conductors-and-c-52523383

## Summary

### Background

The case involves an appeal against an order of the National Company Law Appellate Tribunal (NCLAT) dated September 04, 2018. The NCLAT order was related to an appeal filed by Equipment Conductors Cables Limited against an order of the National Company Law Tribunal (NCLT), Hyderabad, which had dismissed a company petition filed by Equipment Conductors Cables Limited under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016. The dispute originates from contracts awarded by Transmission Corporation of Andhra Pradesh Limited (appellant) to Equipment Conductors Cables Limited (respondent) for the supply of goods and services. Disputes arose, leading to arbitration proceedings where the Arbitral Council rejected claims based on Invoice Nos. 1-57 as time-barred but

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## Facts

Transmission Corporation of Andhra Pradesh Limited (appellant) awarded contracts to Equipment Conductors Cables Limited (respondent) for goods and services. Disputes arose, leading to arbitration. The Arbitral Council rejected claims based on Invoice Nos. 1-57 as time-barred but awarded in favor of the respondent for Invoice Nos. 58-82. The respondent's attempts to execute claims related to Invoice Nos. 1-57 were unsuccessful. The respondent issued a demand notice under Section 8 of the IBC, treating the appellant as the corporate debtor. The appellant refuted this claim. The respondent filed an application under Section 9 of the IBC before the NCLT, Hyderabad, which was dismissed on April 09, 2018. The respondent appealed to the NCLAT, which issued an order on

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## Issues and analysis

### Issue 1: Whether the NCLAT's order directing the appellant to settle the claim with the respondent, failing …

**Ratio:** The adjudicating authority must determine whether there is an 'operational debt'

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**Reasoning:** The NCLAT's order was deemed inappropriate because it did not adequately consider the

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**Interpretation:** The NCLAT's order was interpreted as an attempt to coerce the appellant into

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**Application:** The ratio was applied by setting aside the NCLAT's order, as it was found to be

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## Parties

- **Judges:** A.K. S…; Ashok Bh…
- **Respondents:** Transmission…; EQUIPMENT…
- **Other parties:** Over Tu…

## Timeline

- **2010-06-21 — Arbitral…**: Arbitral Council's award: Claims based on Invoice Nos. 1-57 were rejected as time-barred;…
- **2014-08-28 — Order by Additional…**: Additional District Judge remanded the case back to the Arbitral Council for fresh…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 8 — Insolvency resolution by operational creditor](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-8)

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