In an appeal filed by a Suspended Director of the Corporate Debtor filed before the National Company Law Appellate Tribunal, New Delhi (NCLAT), to challenge an order dated 06-05-2026 by the National Company Law Tribunal (NCLT), Mumbai, whereby a Section 9 application by Lintec India Pvt. Ltd., a Bench of Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Member) set aside the impugned order and rejected the Section 9 application under the Insolvency and Bankruptcy Code.
On 12-05-2026, an interim order was passed directing the IRP not to take any steps in pursuance of the impugned order.
The Corporate Debtor and Lintec India had a long-standing commercial relationship. The Corporate Debtor issued multiple purchase orders to Lintec India for the supply of automobile-grade adhesive products for two-wheelers between February 2025 and April 2025. Lintec India supplied goods, raised invoices aggregating to Rs. 9,74,86,143/-, and alleged overdue payments by an email dated 21-04-2025. The Corporate Debtor released payment of Rs. 3,10,73,278/-, but instead of resuming supply, Lintec India demanded a further sum of Rs. 2,38,00,000/-. Thereafter, Lintec India responded with commercially unreasonable conditions for the resumption of supplies.
The Corporate Debtor informed Lintec India of pre-existing disputes between them, and on 20-06-2025, Lintec India issued a demand notice under Section 8, claiming an operational debt of Rs. 9,74,86,143/-. The Corporate Debtor disputed the claim and communicated the breach of confidential information. On 02-07-2025, Lintec India filed a Section 9 petition, and on 11-07-2025, the Corporate Debtor filed a commercial suit before the Bombay High Court. Notice was issued to the Corporate Debtor, and Lintec India was directed to file the NeSL record of default.
On 24-07-2025, Lintec India issued a communication through NeSL demanding Rs. 9,74,86,143/- within 10 days. The authenticated status on the NeSL portal was marked as ‘disputed’. Thereafter, the Corporate Debtor filed a reply to the Section 9 application, and Lintec India filed a rejoinder before the adjudicating authority admitted the Section 9 application.
NCLAT stated that the Supreme Court had laid down the guiding principles for entertaining a Section 9 application in Mobilox Innovations (P) Ltd. v. Kirusa Software (P) Ltd., (2018) 1 SCC 353. It was found that there was communication on behalf of the Corporate Debtor regarding the dispute between the parties even before the issuance of the demand notice, which the Corporate Debtor immediately replied to on 30-06-2025, refuting the claim.
It was stated that, in the present case, the notice of dispute was issued by the Corporate Debtor within 10 days of receipt of the demand notice, and that there was also a record of the dispute in the NeSL records. NCLAT reiterated that when the status of the NeSL record mentions a dispute, the Adjudicating Authority cannot admit a Section 9 application.
NCLAT stated that the Adjudicating Authority had ignored the notice of dispute as well as the NeSL record by observing that the contention of a pre-existing dispute raised by the Corporate Debtor was a mere bluster. It was opined that the Adjudicating Authority had committed an error in admitting the Section 9 application and that the impugned order could not be sustained. Thus, the impugned order was set aside, and the application was rejected.
