The Tax Publishers 2017 TaxPub(CL) 0867 (NCLT-Del)

 

Green Power Engineers (P.) Ltd. v. Faith Merchantile (P.) Ltd.

 

INSOLVENCY AND BANKRUPTCY CODE, 2016

--Initiation of corporate insolvency resolution process by operational creditor-- Application against non-payment of supplied goodsFailed to produce banker's certificate under section 9(3)(c)----When operational creditor failed to produce banker's certificate as mandated under section 9(3)(c) on the ground that bank had refused to issue such certificate showing its inability due to procedural limitations and that there were no specific mechanism available with bank to identify and compartmentalize different transactions between the operational creditor and corporate debtor, then application under section 9 for initiation of corporate insolvency resolution process was to be dismissed.-- Corporate debtor placed a purchase order to operational creditor and the same was supplied by the operational creditor. Operational creditor raised invoices, but some payment had not been made in spite of demand notice. Therefore, the operational creditor filed application under section 9 for initiation of corporate insolvency resolution process, but the operational creditor had not produced banker's certificate as mandated under section 9(3)(c). Held:Bank had refused to issue certificate under section 9(3)(c) to the operational creditor on the ground of its inability due to procedural limitations and that there were no specific mechanism available with bank to identify and compartmentalize different transactions between the operational creditor and the corporate debtor. Hence, the application for initiation of corporate insolvency resolution process was to be dismissed.

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