NCLT Bengaluru Admits Insolvency Petition Against Dunzo Digital Private Limited For Debt Of ₹1.91 Crore

The section 9 IBC petition was filed by the Velvin Packaging Solutions, seeking initiation of the CIRP against the Dunzo Digital Private Limited for default in payment of debt of Rs. 2.29 Cr. inclusive of interest.

The operational creditor raised 107 invoices for the goods delivered to the corporate debtor, amounting to Rs. 6.81 Cr. After the adjustment made towards the payment made, the outstanding amount of Rs. 1.91 Cr. was left. The demand notice issued by the operational creditor remained unanswered, and the attempt at settlement failed. Despite multiple opportunities, it failed to file the objections, and the petition was closed. However, the NCLAT, Chennai, allowed two weeks' time to file the objection. The corporate debtor submitted the objections beyond the prescribed time, but the same was accepted by the NCLT.

The corporate debtor argued that the petitioner concealed the fact that there was an existing dispute between them with regard to the nature of the goods supplied. Also, as per the settlement agreement between them, the dispute should have been referred to arbitration.

The NCLT observed that the corporate debtor has raised a vague dispute with regard to the nature and the quality of the goods without any evidence. It observed that as per the Hon'ble Supreme Court's ruling of Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd., Civil Appeal No. 9405 of 2017, the pre-existing dispute u/s 8(2)(a) of the code should be supported by the contemporaneous evidence.

Further, the NCLT observed that the post-default settlement does not alter the date of default or extinguish the cause of action that occurred. Also, once the default has occurred and the petition is filed, the subsequent settlement doesn't bar the proceedings unless the settlement has been fully acted upon. Relying on the ruling of Trafigura India Pvt. Ltd. v. TDT Copper Ltd. Company Appeal (AT) (Insolvency) No. 742 of 2020, the bench discussed that the default under a settlement neither creates a new operational debt nor does it invalidate the original cause of action.

Furthermore, the bench discussed the ruling of Vidarbha Industries Power Ltd. vs. Axis Bank Ltd. Civil Appeal No. 4633 Of 2021 and clarified that the mere existence of the arbitration clause doesn't bar a section 9 petition, especially when the debt and default have been established.

Lastly, the bench rejected the respondent's contention with regard to debt below the threshold limit due to lack of evidence and admitted the CIRP petition.

Case Name: Velvin Packaging Solutions Pvt. Ltd. vs. Dunzo Digital Pvt. Ltd.

Case No.: CP (IB) No. 36/BB/2024

For Petitioner: Shri Ajinkya Kurdukar with Shri Abhishek D.H.

For Respondent: Shri Kumar Anurag Singh with Shri Zain A. Khan, Shri Mohd. Abran Khan

Corum: Shri Sunil Kumar Aggarwal (Member-Judicial) and Shri Radhakrishna Sreepada (Member-Technical)

Order Date: 06.08.2025