Neeraj Kumar Verma Suspended Director ... vs Mahakaleshwar Mines & Metals Private ...

National Company Law Appellate Tribunal28 October 2025Ashok Bhushan

CitationCompany Appeal (AT) (Insolvency) No. 1109 of 2025

Ratio decidendi

The rule this decision rests on

Where a corporate debtor, in written correspondence before the operational creditor's Section 9 application, repeatedly acknowledges its liability to repay an advance and promises repayment once its bank accounts become operative, that acknowledgement is taken to establish the existence of the debt and the default, and an unreplied demand notice together with such acknowledgements leaves no pre-existing dispute, so that an admission of the Section 9 application by the Adjudicating Authority on that footing discloses no error warranting interference in appeal.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

NATIONAL COMPANY LAW APPELLATE TRIBUNALPRINCIPAL BENCH, NEW DELHICompany Appeal (AT) (Insolvency) No. 1109 of 2025

IN THE MATTER OF: Neeraj Kumar Verma, Suspended Director of Kamal Sponge Steel & Power Ltd. ...Appellant

Versus

Mahakaleshwar Mines & Metals Pvt. Ltd. & Anr. ...Respondents

Present: For Appellant : Mr. Varun Agarwal, Advocate. For Respondents :

ORDER

(Hybrid Mode)

28.10.2025: This appeal has been filed against the order passed by the

Adjudicating Authority dated 04.06.2025 by which the Section 9 application

filed by the Respondent has been admitted. Section 9 proceedings were

initiated by the Operational Creditor for a default of Rs.4,40,36,987/-. The

Adjudicating Authority after hearing both the parties returned finding that

the Operational Creditor has successfully proved the debt and the default and

all ingredients as laid down under Section 9 are fulfilled. The finding has also

been returned that application has been filed within limitation and that there

being no notice of any pre-existing dispute, Section 9 application was

admitted. Appeal has been filed by the Suspended Director of the Corporate

Debtor challenging the order.

2. After having heard learned counsel for the Appellant, we are of the view

that no error has been committed by the Adjudicating Authority in admitting

Cont'd.../ Section 9 application debt and default having been proved. Demand notice

was also issued by the Operational Creditor by Speed Post which was not

replied by the Corporate Debtor. There were several acknowledgements by

the Corporate Debtor which are noted in Para 12.4 of the order. Para 12.4 of

the impugned order is as follows:

"12.4 On perusal of the records, it transpires that the Corporate Debtor time and again acknowledges its liability to pay to the Operational Creditor. The relevant extracts of letters where the Corporate Debtor has acknowledged its liability towards the Petitioner are reproduced hereunder:-

Sr. Letter date Relevant Extracts of the Letters No.

1. 15.11.2017 "We have informed the above development to you with regards to our deal for supply of Sponge Iron. Due to attachment of Bank Accounts & Provisional Attachment we are not able to refund you the advance amount paid by you to us."

2. 02.11.2019 "We have informed the above developments to you with regards to our deal for supply of Sponge Iron. Due to attachment of bank accounts, we are not able to refund you the advance paid by you to us."

3. 27.02.2021 "Due to above, our Bank Accounts are still inoperative and we are no able to refund you the advance amount paid 4.by you to us. We assure you that the advance paid by FOU will he returned to you one our Bank Accounts become operative."

Company Appeal (AT) (Ins.) No. 1109 of 2025 2 of 3

4. 25.04.2023 "We assure you that the advance you paid will be returned to you once our bank accounts are operational."

3. We, thus, are of the view that the Adjudicating Authority after

considering all relevant facts and circumstances found that application under

Section 9 fulfils all ingredients and admitted Section 9 application. We do not

find any error in the order of the Adjudicating Authority admitting Section 9

application. Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical) Archana/nn

Company Appeal (AT) (Ins.) No. 1109 of 2025 3 of 3

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