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Judgment
ORDER
Per: Bidisha Banerjee, Member (Judicial)
The Court congregated through hybrid mode.
Heard the Ld. Counsels of both the parties.
The petition has been preferred by Burdwan Kraftboard LLP, the Operational Creditor/OC, against Narayani Packaging Private Limited, the Corporate Debtor/CD, alleging non-payment of operational debt of Rs. 1,61,71,301/-.
4. Submissions of the Operational Creditor
Around July, 2023, the Directors of the Corporate Debtor approached the operational creditor for supply of kraft papers of various specifications, as OC was a premier manufacturer of corrugated cartoons.
The operational creditor started supplying kraft papers from 22nd July, 2023, on the basis of purchase order being placed on WhatsApp No. 9831015309.
From 22nd July, 2023 onwards, delivery of the said goods were made at the site of the CD in separate batches and challan/Challan cum GST Invoice had been produced to the CD with respect to the same. The CD received all goods as demanded and specified and as agreed to by and between the parties.
The Operational Creditor had supplied total goods worth Rs. 3,09,45,989/-. The said CD, made payments between 1st September, 2023 and 30th March, 2024 on ad hoc basis amounting to Rs. 1,62,37,638/, credit whereof was given by the Operational Creditor in the running and continuous account of the CD maintained by the Operational Creditor. An amount of Rs. 1,47,08,351/-, remains due and payable by the CD to the Operational Creditor.
The Operational Creditor had on 29/04/2024 forwarded Balance Confirmation of Accounts along with the Ledger to the CD by dint of an electronic mail. Such confirmations of accounts along with appropriate ledger maintained by the Operational Creditor were received by the CD without any demur or protest. The CD unequivocally admitted its dues and assured that the dues of the Operational Creditor would be paid.
The CD received all the consignments of kraft papers lastly on 3rd November, 2023 and have accepted the same without any demur or objection and have utilized the same for furtherance of the business. But the Operational Creditor is yet to receive payment of an amount of Rs. 1,47,08,351/- for the kraft papers supplied between 22nd July, 2023 to 3rd November, 2023.
The Operational Creditor sent a demand notice under the IBC, 2016, dated 24th June, 2024, which was duly received by the CD and replied to.
The CD by way of its reply dated 8th July, 2024, alleged supply of inferior quality products which however was not backed up by any particulars or elaboration.
The CD has failed to mention any particulars of consignments being returned for being of inferior quality and justify why the CD continued to accept the consignments from the Operational Creditor if there were indeed quality issues in the goods supplied by the Operational Creditor.
The Corporate Debtor has accepted the confirmation of accounts wherein the Operational Creditor informed the CD of the amount of Rs. 1,47,08,351/-, remaining due and payable by the Corporate Debtor to the Operational Creditor in lieu of the kraft papers being supplied.
The e-mail dated 29.04.2024, of the CD is undeniable admission of the operational debt and acceptance of its liability to repay the Operational Creditor.
Hence this petition.
5. Submission of the Corporate Debtor :
None had entered appearance on behalf of the CD on the day the matter was reserved for orders.
On 11.02.2025, the CD was set ex-parte.
The CD has neither filed its reply nor availed of the opportunity given to them on 07.08.2025 to file written notes of arguments.
As such there is no denial of the claim of the OC.
The CD is thus conspicuous by its silence.
6. Conclusion :
We have perused the following :
Confirmation of Accounts sought for by the Operational Creditor from the CD with details of accounts, list of invoices and credit at Annexure D which clearly indicates that “if no reply is received from you within a fortnight, it will be assumed that you have accepted the balance shown below.”
It is as under :-
ii) The corresponding Tax Invoices at page 33 onwards.
iii) Copy of e-mail dated 29.04.2024 from the OC.
iv) Form 4 Demand Notice of the OC to CD under Rule 5 dated 24.06.2024.
CD’s reply to the demand notice dated 08.07.2024 alleging supply of defective goods with no supporting documents, which is proof of service of Form 4 Demand Notice.
On careful examination of the documents and submissions, we are satisfied that the Operational Creditor has successfully established the existence of a debt and default within the meaning of Sections 3(11) and 3(12) of the Code. The petition is complete in all aspects, and not barred either under section 10A of IBC, 2016, or under the Limitation Act, 1963.
At this juncture, it would be apt to quote the Rule 49 and Rule 110 of the National Company Law Tribunal Rules, 2016, which are reproduced in verbatim as below: -
Rule 49: Ex-parte Hearing and disposal. – (1) Where on the date fixed for hearing the petition or application or on any other date to which such hearing may be adjourned, the applicant appears and the respondent does not appear when the petition or the application is called for hearing, the Tribunal may adjourn the hearing or hear and decide the petition or the application ex-parte. xxx xxx xxx
Rule 110: Default of appearance of respondent and
consequences. — Where the respondent, despite effective service of summons or notice on him does not appear before the date fixed for hearing, the Tribunal may proceed to hear the appeal or application or petition ex-parte and pass final order on merits: Provided that it is open to the Tribunal to seek the assistance of any counsel as it deems fit in case the matter involves intricate and substantial questions of law having wide ramifications.
In this context, the Doctrine of Non-Traversal assumes relevance. This doctrine, expressed through the principle “if not denied, accepted,” is a well-settled position of law under Order VIII Rule 5 of the Code of Civil Procedure, 1908. It signifies that when a material averment is not specifically denied, it is deemed to have been admitted. The Rule mandates that every allegation of fact must be denied specifically or by necessary implication, failing which it shall be taken as admitted. The rationale behind this doctrine is to narrow the scope of controversy between the parties and to ensure that only those issues which are genuinely disputed are left for adjudication.
In this regard we rely on the judgment of the Hon’ble NCLAT in Hardik v. Ramdeo R. Agarwal and Anr., Company Appeal (AT) (Insolvency) No. 1295 of 2023 reported in (2025) ibclaw.in 667 NCLAT, where it was held that :
“15.… then did not choose to appear in court to contest the application filed under Section 9 and even did not file the reply despite the fact that the Court had adjourned the case many times to await the appearance of the Respondent for completion of the pleadings and ultimately it was found that the CD is deliberately avoiding to contest the application filed under Section 9 and hence, the Tribunal on the basis of the record of the copy of GST returns and TCS returns which proves that the goods were supplied to the CD, has rightly admitted the application filed under Section 9 on the ground that there is debt and default both present in the lis which are sufficient for the court to push the CD into insolvency by appointing the IRP.”
We further rely on the judgment of the Hon’ble NCLAT Chennai Bench in Metals and Metal Electric Pvt. Ltd. v. Prince Foundations Ltd., passed in IA No. 1293/2025 in Company Appeal (AT) (CH) (Ins) No. 216/2023, reported in (2025) ibclaw.in 891 NCLAT, which is as follows :
“14)... Hence, when the statute has assigned the conditions under which the application under Section 9 of I&B Code could be rejected, and if it doesn’t fall to be within those conditions as provided under Section 9(5)(ii) of I&B Code, any other reasoning cannot be assigned by the Learned Tribunal to reject an application under Section 9 of I&B Code….”
At this juncture, we would fumigate our mind with the oft quoted judgment of the Hon’ble Apex Court, which is as under : Innoventive Industries Ltd. v. ICICI Bank reported in (2018) 1 SCC 407: MANU/SC/1063/2017 has laid down that:
“27.The scheme of the Code is to ensure that when a default takes place, in the sense that a debt becomes due and is not paid, the insolvency resolution process begins. ...’
“28.… the corporate debtor is entitled to point out that a default has not occurred in the sense that the "debt", which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, ...”
8. Conclusion :
In absence of any denial of supply of materials by the OC to the CD, and in the light of the enumerations supra, we deem it appropriate to admit the present application and accordingly we order the initiation of Corporate Insolvency Resolution Process (CIRP) in respect of the Corporate Debtor by the following Orders:
The application bearing CP (IB) No. 277/KB/2024 filed by Burdwan Kraftboard LLP, the Operational Creditor, under section 9 of the Code for initiating CIRP against Narayani Packaging Private Limited, the Corporate Debtor, is admitted.
As a consequence of this application being admitted in terms of Section 9 of the I&B Code, moratorium as envisaged under the provisions of Section 14(1) of the Code, shall follow in relation to the Respondent/(CD) as per clauses (a) to (d) of Section 14(1) of the Code. However, during the pendency of the moratorium period, terms of Section 14(2) to 14(3) of the Code shall come into force.
The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during moratorium period.
The moratorium shall have effect from the date of this order till the completion of the CIRP or until this Adjudicating Authority approves the resolution plan under sub-section (1) of section 31 of the IBC or passes an order for liquidation of Corporate Debtor under section 33 of the IBC, as the case may be.
The Applicant has not proposed any name as the “IRP”. Hence, we appoint Mr. Rajnandan Kumar, Registration No. IBBI/IPA-001/IP-P02721/2022-2023/14161, Email: rnk_sa2004@yahoo.co.in, Phone No. 9831151505, as the Interim Resolution Professional (IRP) of the Corporate Debtor, by invoking the provision under Section 16 (3) (a) of the I&B Code, 2016 to carry out the functions as per the I&B Code subject to submission of a valid Authorisation of Assignment in terms of regulation 7A of the Insolvency and Bankruptcy Board of India (Insolvency Professional) Regulations, 2016. The fee payable to IRP or the RP, as the case may be, shall be compliant with such Regulations, Circulars and Directions as may be issued by the Insolvency & Bankruptcy Board of India (IBBI). The IRP shall carry out his functions as contemplated by sections 15, 17, 18, 19, 20 and 21 of the I&B Code.
In pursuance of Section 13 (2) of the Code, we direct the IRP or the RP, as the case may be, to cause a public announcement immediately with regard to the admission of this application under Section 9 of the Code and call for the submission of claims under Section 15 of the Code. The public announcement referred to in Clause (b) of sub-section (1) of Section 15 of Insolvency & Bankruptcy Code, 2016, shall be made immediately. The expression immediately means within three days as clarified by Explanation to Regulation 6 (1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.
During the CIRP period, the management of the Corporate Debtor shall vest in the IRP or the RP, as the case may be, in terms of section 17 of the IBC. The officers and managers of the Corporate Debtor shall provide all documents in their possession and furnish every information in their knowledge to the IRP within one week from the date of receipt of this Order, in default of which coercive steps will follow. There shall be no future opportunities in this regard.
The Interim Resolution Professional is expected to take full charge of the Corporate Debtor, its assets and its documents without any delay whatsoever. He is also free to take police assistance in this regard, and this Court hereby directs the concerned Police Authorities to render all assistance as may be required by the Interim Resolution Professional in this regard.
The IRP/RP shall submit to this Adjudicating Authority periodical report with regard to the progress of the CIRP in respect of the Corporate Debtor.
The Operational Creditor shall deposit a sum of Rs 200000/-with the IRP to meet the expenses arising out of issuing public notice and inviting claims. These expenses are subject to approval by the Committee of Creditors (CoC).
In terms of section 9(5)(a) of the Code, Court Officer of this Court is hereby directed to communicate this Order to the Operational Creditor, the Corporate Debtor and the IRP by Speed Post, email and WhatsApp immediately, and in any case, not later than two days from the date of this Order.
Additionally, the Operational Creditor shall serve a copy of this Order on the IRP and on the Registrar of Companies, West Bengal, by all available means for updating the Master Data of the Corporate Debtor. The said Registrar of Companies shall send a compliance report in this regard to the Registry of this Court within seven days from the date of receipt of a copy of this order.
CP (IB) No. 277/KB/2024 to come up on 17.12.2025 for filing periodical report.
Certified copy of this order, if applied for with the Registry be supplied to the parties in compliance with all the requisite formalities.