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Judgment
The case is fixed for pronouncement of the order. The order is pronounced in the open court vide separate sheet.
O R D E R (Per Bench)
This Company Petition has been filed on 4.02.2026 vide inward no. E-00441 by the Applicant - M/s. Navkar Polymers (hereinafter referred to as 'Operational Creditor') against the Respondent- Neo Microns Private Limited (hereinafter referred to as 'Corporate Debtor') under Section 9 of the IBC, 2016 read with Rule 6 of the IB (AAA) Rules, 2016 for initiation of CIRP, appointment of IRP and declaration of moratorium for default in payment of operational debt of Rs.2,54,80,730.00 Ps. including interest arising from supply of goods/services.
On perusal of Part-I of Form-5, it is evident that the Operational Creditor is a proprietorship firm having GST Registration No: 24BASPB3923L1ZK represented through its proprietor Mr. Samkit Ashokkumar Bagrecha through his representative, Mr. Atul Shinde. The Operational Creditor has been engaged in the business of plastic raw materials and specializing in masterbatches, polymers and granules, serving industries from packaging to general plastics etc.
On perusal of Part-II of Form-5, it is further evident that the Corporate Debtor- Neo Microns Private Limited having CIN: U25199GJ2009PTC057978. is an unlisted private limited company which incorporated on 03.09.2009 under the provisions of the Companies Act, 1956. The registered address of the company is stated to be at: B-401, Lake View Tower, Opp. Vastrapur Lake, Nr. Alpha Mall, Vastrapur, Ahmedabad, Gujarat, India - 380015. The authorised share capital of the company is Rs.2,70,10,000/- and the paid-up share capital is Rs.2,52,31,080/- as per Master Data from Ministry of Corporate Affairs website which is annexed with the Petition as Annexure-B.
On perusal of Part-III of Form-5, the Operational Creditor has proposed the name of CA Bimal Ashok Desai, having IBBI Registration No: IBBI/IPA- 001/IP-P00748/2017-18/11281 and having address at: 217, Florence Pride, Opp. Corporation Garden, Sun Pharma Road, Vadodara – 390020. The proposed IRP has also given its written consent in Form-2 placed on record as Annexure-L.
On perusal of Part-IV of the Form-5, shows that the total amount of debt is Rs 2,54,80,730/- comprising of principal amount of Rs 1,15,41,334/- and interest of Rs. 1,39,39,386/-. As stated, the The debt fell due on various dates between 19.07.2017 and 11.02.2020. The date of default has been stated as 13.03.2020, being the date on which the account was classified as overdue and payable.
Upon perusal of Part-IV and Part-V of Form-5, it is observed that the Operational Creditor has set out the following facts in support of the present petition: -
The Operational Creditor is engaged in the business of manufacturing plastic raw materials including masterbatches, polymers and granules, and has been supplying such goods to various industries including packaging and plastics.
The Corporate Debtor is engaged in manufacturing products including PP woven sacks, HDPE bags, Leno bags, tarpaulins, FIBC bulk bags and geosynthetics, and had business dealings with the Operational Creditor for supply of raw materials.
The Operational Creditor supplied masterbatches and related goods to the Corporate Debtor during the period from 01.07.2017 to 11.02.2020 and maintained a running account of transactions in its books of account, placed on record as Annexure D.
The Operational Creditor has placed on record a detailed table of computation along with statement of account showing transactions, outstanding amount and dates of default, annexed as Annexure C, which reflects the amount due from the Corporate Debtor.
The Corporate Debtor placed orders telephonically and the Operational Creditor raised invoices along with e-way bills upon supply and delivery of goods. Copies of invoices generated are also placed on record as Annexure-E.
Despite receipt of goods, the Corporate Debtor failed to make payment from 19.07.2017 onwards and continued to default, and has acknowledged the outstanding liability through ledger confirmation placed on record as Annexure F.
The total operational debt is Rs. 2,54,80,730/- comprising Rs. 1,15,41,334/- towards principal and Rs. 1,39,39,386/- towards interest calculated up to 31.07.2025 for non-payment of invoices.
The Operational Creditor issued Demand Notice under Section 8 of the Code dated 12.08.2025. The earlier petition was dismissed as premature. Thereafter, a fresh demand notice dated 13.01.2026 was issued in compliance with the Code. However, and no payment or reply was received from the Corporate Debtor within the statutory period.
The Operational Creditor has also filed Form-C dated 02.09.2025 issued by National E-Governance Services Limited (“NeSL”) showing default amount of Rs. 2,54,80,730/- and date of default as 13.03.2020, annexed as Annexure G, and has also placed earlier proceedings in CP(IB) No. 401 of 2025 dismissed on 13.10.2025 as premature and defective under Section 9(5)(ii)(c) of the Code as Annexure H
The Operational Creditor has filed affidavit under Section 9(3)(b) and 9(3)(c), annexed GST registration and returns as Annexure J and Annexure K, and relied upon judgment in Civil Appeal No. 15135 of 2017 Macquarie Bank Limited versus Shilpi Cable Technologies Ltd.
In view of the above facts has sought initiation of Corporate Insolvency Resolution Process, appointment of Interim Resolution Professional and declaration of moratorium under the Insolvency and Bankruptcy Code, 2016
Pursuant to issuance of notice upon the Corporate Debtor, a reply was filed on 06.04.2026 vide inward diary no. D-2488 denying various averments made in the Petition. The contentions of the Corporate Debtor are mentioned hereunder: -
The Corporate Debtor has objected to the maintainability of the petition under Section 9(5)(ii)(d) of the Code on the ground of existence of dispute.
It is contended that there is no admitted liability towards the alleged operational debt and the claim of the Operational Creditor is denied.
The Corporate Debtor submits that disputes were raised prior to issuance of demand notice regarding quality of goods supplied by the Operational Creditor.
It is stated that the goods supplied were defective which caused operational issues and loss, and therefore payments were withheld.
The Corporate Debtor has relied upon Section 5(6) of the Code to contend that dispute includes dispute relating to quality of goods or services.
It is further contended that disputes were communicated orally to the Operational Creditor, though not in writing, during the course of business.
The Corporate Debtor has relied upon judgment in Civil Appeal No. 9405 of 2017 Mobilox Innovations Private Limited versus Kirusa Software Private Limited to contend that even existence of dispute is sufficient to reject the application.
It is submitted that the Adjudicating Authority is required to examine existence of a plausible dispute and not the merits of the defence.
On the basis of the above contentions, the Corporate Debtor has prayed for rejection of the present petition under Section 9(5)(ii)(d) of the Code.
The Operational Creditor has filed a rejoinder on receipt of the reply of the Respondent/Corporate Debtor on 06.04.2026 vide inward diary no. D-2978 as under:
The Operational Creditor submits that the Corporate Debtor has not placed on record any document to establish existence of dispute regarding quality of goods.
It is contended that no notice of dispute was raised by the Corporate Debtor prior to issuance of demand notice under Section 8 of the Code.
The Operational Creditor denies the allegation of defective goods and submits that the defence raised is without supporting material.
It is submitted that the Corporate Debtor has acknowledged the outstanding liability in its books of account and ledger confirmation is placed on record.
The Operational Creditor submits that the plea of oral dispute is not supported by any evidence and cannot be considered as existence of dispute under the Code.
It is further submitted that the defence raised by the Corporate Debtor is unsupported and raised only to avoid payment of dues.
The Operational Creditor reiterates that all statutory requirements under Section 9 of the Code have been complied with.
On the basis of the above, the Operational Creditor has prayed for admission of the petition and initiation of Corporate Insolvency Resolution Process against the Corporate Debtor.
We have heard the submissions advanced by the Learned Counsel for the Applicant/Operational Creditor and the Learned Counsel for the Respondent/Corporate Debtor and have perused the pleadings and material placed on record.
The present petition has been filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 seeking initiation of Corporate Insolvency Resolution Process against the Corporate Debtor for default in payment of operational debt.
The primary issue for consideration is whether there exists an operational debt and default, and whether there is any pre-existing dispute between the parties prior to issuance of demand notice under Section 8 of the Code
From the material on record, it is evident that the Operational Creditor has supplied goods to the Corporate Debtor during the period from July 2017 to February 2020 and has placed invoices, ledger account and computation of outstanding amount on record to substantiate the claim of operational debt.
The ledger account and statement of transactions placed on record reflect a running account between the parties and indicate an outstanding amount payable by the Corporate Debtor.
The Operational Creditor has also placed on record ledger confirmation issued by the Corporate Debtor, which indicates acknowledgment of liability towards the Operational Creditor.
The Operational Creditor has issued demand notice dated 13.01.2026 under Section 8 of the Code and the Corporate Debtor has not placed on record any reply to the said notice within the statutory period.
The Form-C issued by NeSL has also been filed, reflecting the occurrence of default as 13.03.2020 and supports the claim of the Operational Creditor, thereby satisfying the requirement of Section 9(3)(c) of the Code and other supporting documents, in light of the judgment in Macquarie Bank Limited vs. Shilpi Cable Technologies Ltd.
The contention of the Corporate Debtor is that there exists a pre-existing dispute regarding quality of goods supplied and therefore the petition is liable to be rejected.
It is observed that the Corporate Debtor has not placed on record any document to substantiate that such dispute was raised prior to issuance of demand notice. The plea of oral dispute, in absence of any supporting material, does not establish existence of a dispute in terms of Section 5(6) of the Code.
The reliance placed by the Corporate Debtor on the judgment in Mobilox Innovations Private Limited versus Kirusa Software Private Limited is noted. However, the said judgment requires that dispute must be pre-existing, genuine, and supported by evidence, and should not be a mere bluster or unsupported assertion.
In the present case, the defence of “oral dispute” raised by the Corporate Debtor is not supported by any material on record and appears to be unsupported. The acknowledgement of liability in the books of account of the Corporate Debtor further negates the contention of existence of dispute.
Therefore, this Adjudicating Authority is of the view that there is no pre-existing dispute between the parties and the defence of “oral dispute” raised by the Corporate Debtor constitutes a moonshine defence, lacking substance and raised only to evade liability.
Hence, the Operational Creditor has successfully established the existence of operational debt, default on the part of the Corporate Debtor and absence of any pre-existing dispute. The amount in default exceeds the threshold prescribed limit of Rs.1.00 Crore under Section 4 of the Code.
The petition is within limitation under Article 137 of the Limitation Act, 1963. The date of default being 13.03.2020, and further, the acknowledgment of liability in the ledger confirmation extends limitation under Section 18 of the Limitation Act, 1963. Further, the default does not fall within the purview of Section 10A of the Code as the date of default (13.03.2020) falls prior to the period covered under Section 10A of the Code. Therefore, the present petition deserves to be admitted
Accordingly, in light of the above facts and circumstances, it is, hereby ordered as under: -
The Respondent/Corporate Debtor – Neo Microns Private Limited is admitted in Corporate Insolvency Resolution Process under section 9(5) of the Code.
As a consequence, thereof, a moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 is declared for prohibiting all of the following in terms of Section 14(1) of the Code.
a. The institution of suits or continuation of pending suits or proceedings against the Corporate Debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority;
b. Transferring, encumbering, alienating or disposing of by the Corporate Debtor any of its assets or any legal right or beneficial interest therein;
c. Any action to foreclose, recover or enforce any security interest created by the Corporate Debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;
d. The recovery of any property by an owner or lessor where such property is occupied by or in the possession of the Corporate Debtor.
e. The provisions of sub-Section (1) shall however, not apply to such transactions, agreements as may be notified by the Central Government in consultation with any financial sector regulator and to a surety in a contract of guarantee to a Corporate Debtor. The moratorium does not apply to transactions notified by the Central Government, as per Section 14(3)(a) of the IB Code, 2016.
The order of moratorium under section 14 of the Code shall come to effect from the date of this order till the completion of the Corporate Insolvency Resolution Process or until this Adjudicating Authority approves the Resolution Plan under sub-section (1) of section 31 or passes an order for liquidation of the Corporate Debtor under Section 33 of the IBC 2016, as the case may be.
However, in terms of Section 14(2) to 14(3) of the Code, the supply of essential goods or services to the Corporate Debtor as may be specified, if continuing, shall not be terminated or suspended, or interrupted during the moratorium period.
Since, the Operational Creditor has proposed the name of IRP, we appoint Mr. Bimal Ashok Desai, having IBBI Registration No: IBBI/IPA- 001/IP-P00748/2017-18/11281, having address at: 217, Florence Pride, Opp. Corporation Garden, Sun Pharma Road, Vadodara – 390020, (e-mail: bimal.a.desai@icai.org) under section 13 (1)(c) of the Code to act as Interim Resolution Professional (IRP). He shall conduct the Corporate Insolvency Process as per the Insolvency and Bankruptcy Code, 2016 r.w. Regulations made thereunder.
The IRP so appointed shall make a public announcement (e.g., newspapers, websites) under Regulation 6(2) of IBBI Regulations, 2016, of the initiation of the Corporate Insolvency Resolution Process and call for submissions of claims under section 15 within three days of appointment as per Regulation 6 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, as required by Section 13(1)(b) of the Code.
The IRP shall perform all his functions as contemplated, inter-alia, by sections 17, 18, 20 and 21 of the Code. It is further made clear that all personnel connected with the Corporate Debtor, its promoters, or any other person associated with the management of the Corporate Debtor are under legal obligation as per section 19 of the Code to extend every assistance and cooperation to the IRP. Where any personnel of the Corporate Debtor, its promoters, or any other person required to assist or co-operate with IRP, do not assist or cooperate, the IRP is at liberty to make appropriate application to this Adjudicating Authority with a prayer for passing an appropriate order.
The IRP is expected to take full charge of the Corporate Debtor's assets and documents without any delay whatsoever within seven days of this order. The Interim Resolution Professional/Resolution Professional may seek assistance of the local administration or police authorities, if required, for taking custody of the assets and records of the Corporate Debtor.
The IRP shall be under a duty to protect and preserve the value of the property of the 'Corporate Debtor' and manage the operations of the Corporate Debtor as a going concern as a part of the obligation imposed by section 20 of the Code.
The IRP or the RP, as the case may be, shall submit to this Adjudicating Authority a periodical report with regard to the progress of the CIRP in respect of the Corporate Debtor.
We direct the Operational Creditor to pay IRP a sum of Rs.3,00,000/- (Rupees Three Lakh Only) in advance exclusive of applicable taxes, within 7 days from the date of this order to meet the initial costs of the CIRP, including issuing public notice and inviting claims, as per Regulation 33(1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. This amount shall be adjustable against the IRP's fees and expenses as approved by the Committee of Creditors (CoC) under Regulation 33(3), with any excess refundable to the Operational Creditor or shortfall recoverable from the Corporate Debtor's estate as CIRP costs.
The Registry is directed to communicate this order to the Operational Creditor, Corporate Debtor, and to the Interim Resolution Professional, the concerned Registrar of Companies and the Insolvency and Bankruptcy Board of India after completion of necessary formalities, within seven working days, and upload the same on the website immediately after pronouncement of the order. The Registrar of Companies shall update the Corporate Debtor's Master Data on the MCA portal to reflect its status as 'under Corporate Insolvency Resolution Process' within 7 working days of receiving this order and submit a compliance report to the Registrar, NCLT, within 14 working days.
The public announcement under Regulation 6(2) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, shall be published in at least one English (national edition) and one vernacular newspaper with wide circulation in the state of the Corporate Debtor's registered office (Gujarat) and on the Corporate Debtor's website, if any, as per Form A of the said Regulations.
The commencement of the Corporate Insolvency Resolution Process shall be effective from the date of this order.
Accordingly, this Petition being CP(IB)/89/9/AHM/2026 is hereby admitted. A certified copy of this order may be issued, if applied for, upon compliance with all requisite formalities.