Mittal Polymers Vs Suvarna Additives Private Limited (NCLT Mumbai)
NCLT rejects application for initiating CIRP in respect of Suvarna Additives Private Limited and held that CIRP not to be allowed in a case which lacks any proof of debt and default committed by the Corporate Debtor.
In a significant legal development, the National Company Law Tribunal (NCLT), Mumbai, rejected an application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) by Mittal Polymers against Suvarna Additives Private Limited. The case revolved around allegations of unpaid dues and default by the corporate debtor, Suvarna Additives, which Mittal Polymers claimed justified initiating the Corporate Insolvency Resolution Process (CIRP).
Mittal Polymers, an operational creditor, alleged that Suvarna Additives owed them Rs. 2,33,10,961, comprising principal and compound interest under the MSMED Act. The basis of this claim was several invoices issued between 2015 and 2019 for raw materials supplied. Despite multiple invoices, Mittal Polymers argued that a significant amount remained unpaid, leading them to issue a demand notice under Section 8 of the IBC in November 2019.
The defense presented by Mittal Polymers included a detailed breakdown of invoices issued and payments received, amounting to Rs. 2,04,46,631, leaving a balance of Rs. 1,12,17,578 unpaid by Suvarna Additives. Additionally, they highlighted the non-appearance of Suvarna Additives at hearings and their delayed response, which further complicated the proceedings.
