Case Details: Cosmo World v. Supereco Automotive Co. LLP - [2025] 175 taxmann.com 717 (NCLT-Indore)
Judiciary and Counsel Details
- Sanjeev Kumar Sharma, Technical Member & Shammi Khan, Judicial Member
- Mustafa Alam, Adv. for the Applicant.
- Rohit Dubey, Adv. for the Respondent.
Facts of the Case
In the instant case, the applicant-operational creditor and respondent-corporate debtor entered into an agreement under which the respondent was to manufacture and supply electric vehicles to the applicant as an exclusive Original Equipment Manufacturer (OEM).
The applicant paid a purchase advance to the respondent for the supply of electric vehicles, but the respondent failed to deliver the vehicles as per the agreement. Thus, the applicant issued a demand notice, but respondent neither replied to the demand notice nor paid the outstanding amount. Consequently, the applicant filed an application under section 9 of the IBC.
It was noted that transactions of advance made by the creditor, invoices raised by the corporate debtor, and advances that remained unadjusted, leading to the amount payable by the corporate debtor, were all interlinked. Therefore, the claim made by the creditor was with respect to the provision of goods and fit into the definition of operational debt as given in section 5(21) of the IBC.
NCLT Held
The NCLT held that the default occurred in April 2022, when the corporate debtor failed to deliver vehicles as per the agreement dated 16.01.2021 and the date of the demand notice, 22.03.2023, which was outside the section 10A period. Thus, the threshold limit was met.
Further, the NCLT held that since the applicant had complied with procedural requirements and the respondent’s objections lacked merit, the application was to be admitted.
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