NCLT Dismisses Mayasheel Retail Insolvency Petition

Case Details

Case Name: Jatinder Kumar Jain, Proprietor of M/s Rachit Knitwear vs Mayasheel Retail India Limited

Court/Authority: National Company Law Tribunal Bench - VI, New Delhi

Case Number: C.P (IB)/178(ND)2025

Order Date: 22.05.2026

Period of Dispute: Invoices issued during 07.10.2022 to 15.11.2022

Parties Involved

Petitioner/Operational Creditor: Jatinder Kumar Jain, Proprietor of M/s Rachit Knitwear (represented through Authorised Representative Mr. Chander Mohan Jain)

• Engaged in manufacturing and supply of wearing apparels
• Registered as 'Micro' Enterprise under Micro, Small & Medium Enterprise Development Act, 2006

Respondent/Corporate Debtor: Mayasheel Retail India Limited

• Engaged in wholesale and retail trade of wearing apparels and allied goods

Legal Representatives:

• For Applicant: Adv. Shubham Gupta
• For Respondent: None appeared (proceeded ex parte)

Tribunal Members:

• Hon'ble Ms. Anu Jagmohan Singh, Member (Technical)
• Hon'ble Justice Jyotsna Sharma, Member (Judicial)

Issues / Allegations / Violations

The operational creditor filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 read with rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.

Alleged Default: Corporate debtor failed to make payment against invoices for apparels supplied during 07.10.2022 to 15.11.2022

Total Claim Amount: Rs. 1,22,79,777/- (One Crore Twenty Two Lakhs Seventy Nine Thousand Seven Hundred Seventy Seven only)

• Principal outstanding amount: Rs. 83,13,954/-
• Interest @ 24% per annum: Rs. 39,65,823/-

Demand Notice: Operational creditor issued Demand Notice under Section 8 of IBC dated 22nd November 2024, delivered by email on 23.11.2024. No response was received from the corporate debtor.

Findings & Observations

The tribunal examined whether the application satisfied the minimum threshold requirement prescribed under Section 4 of the Insolvency and Bankruptcy Code, 2016.

Key Findings:

• The principal operational debt claimed is Rs. 83,13,954/-, which is below the statutory threshold of Rs. 1 Crore
• The applicant sought to cross the threshold by adding interest @ 24% per annum based on conditions printed on invoices
• The Hon'ble NCLAT in Comet Performance Chemicals Pvt. Ltd. v. Aarvee Denims and Exports Ltd. (Company Appeal (AT) (Insolvency) No. 1878 of 2024, decided on 13.01.2025) held that interest cannot be considered part of operational debt unless expressly agreed upon by parties
• Mere mention of interest in invoices does not create an enforceable claim without mutual agreement
• The tribunal found no agreement between the parties regarding charging of interest on delayed payment
• The stipulation printed unilaterally on invoices cannot create an enforceable contractual obligation

Final Ruling & Enforcement

The application bearing CP (IB) No. 178/ND/2025 was dismissed as not maintainable under Section 4 of the Insolvency and Bankruptcy Code, 2016.

Reason for Dismissal: The principal operational debt remained below Rs. 1 Crore threshold after excluding the interest component, which could not be considered part of the operational debt due to lack of express agreement between parties.

The corporate debtor was proceeded ex parte against vide order dated 05.05.2025 after failing to appear despite service of notice on 21.03.2025. The matter was heard on multiple dates (06.06.2025, 21.07.2025, 29.08.2025, 08.10.2025, 14.11.2025, 16.12.2025, 04.02.2026 and 29.04.2026) but no representative appeared for the corporate debtor.