Corporate Insolvency Resolution Process Application Dismissed Due to Lack of Evidence, Non-Submission of Mandatory Forms, and Existence of Pre-Existing Disputes
In a significant judgment delivered on September 9, 2026, the National Company Law Tribunal (NCLT), Ahmedabad Bench, has rejected the Corporate Insolvency Resolution Process (CIRP) petition filed by Make India Impex against Elite Green Pvt. Ltd. The petition, filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), sought initiation of insolvency proceedings on the grounds of default in repayment of dues exceeding Rs. 9.10 crore.
The Applicant, Make India Impex, an operational creditor engaged in clearing, forwarding, and customs clearance services, claimed that Elite Green Pvt. Ltd. availed of its services for export consignments starting February 2024. Despite repeated issuance of invoices and demand notices, the Corporate Debtor allegedly failed to clear outstanding payments, which led the Applicant to approach the NCLT for insolvency proceedings.
However, upon thorough examination of the records and submissions, the Tribunal observed critical lapses on the part of the Applicant. The key findings included:
1. Absence of Evidence of Delivered Services: The Applicant failed to provide any invoices, contracts, or physical documents confirming the delivery of services to the Corporate Debtor. The Tribunal noted that the Applicant could not rely on third-party trade documents to establish its claims.
2. Lack of Physical Agreement or Quotations: No physical quotations or agreements outlining the terms and conditions of work and payment were placed on record, making the claim unsubstantiated.
3. Non-Compliance with Mandatory Forms: The demand notice issued under Section 8(1) of the IBC was not in the prescribed format. Crucially, the Applicant did not submit the mandatory Form-3 and Form-4 as required under the IBC framework. Form-4, which must be filed by an Operational Creditor, was missing.
4. Existence of Pre-Existing Disputes: The Corporate Debtor contended the existence of disputes related to the work done, which was supported by the filing of FIRs by both parties before issuance of the demand notice. The Applicant failed to furnish an affidavit affirming the absence of any pre-existing dispute, a mandatory requirement under Section 9(3)(b).
The Tribunal emphasized that strict compliance with the statutory requirements under the Insolvency and Bankruptcy Code is mandatory for admission of any CIRP application. The presence of pre-existing disputes and procedural non-compliance renders the application non-maintainable.
As a result, the NCLT dismissed the petition filed by Make India Impex with costs, thereby safeguarding the Corporate Debtor from unwarranted insolvency proceedings in the absence of proper evidence and adherence to procedural mandates.
This ruling reinforces the principle that insolvency proceedings are not to be used as a tool to resolve commercial disputes without adequate documentation and compliance with the IBC's procedural safeguards.
Bottom Line:
Insolvency and Bankruptcy Code, 2016 - Application under Section 9 of the IBC seeking initiation of Corporate Insolvency Resolution Process (CIRP) rejected due to non-compliance with statutory requirements, including lack of evidence of delivered services, absence of a physical agreement, non-compliance with Form-3 and Form-4 requirements, and pre-existing disputes between the parties.
Statutory provision(s):
Insolvency and Bankruptcy Code, 2016 - Section 8(1), Section 9, Section 9(3)(b)
Make India Impex v. Elite Green Pvt. Ltd., (NCLT)(Ahmedabad) : Law Finder Doc Id # 2975455
