POPolycab India542652CIRP or IBC

NCLAT allows appeal, sets aside NCLT Ahmedabad order that admitted Section 9 petition

NCLAT, by its order dated October 30, 2026, has allowed the company's appeal and set aside the NCLT Ahmedabad Bench order dated October 07, 2026.

By ScoutQuest · Fri 30 Oct 2026, 12:18 PM IST · 3 min read

NCLAT order date

October 30, 2026

Claimed operational debt

Rs. 2.78 Cr

Stand-alone revenue FY 2025-26

Rs. 2,81,851.77 million

The company has told the stock exchanges that the National Company Law Appellate Tribunal (NCLAT) has allowed its appeal and set aside the order passed by the NCLT Ahmedabad Bench on October 07, 2026.

What the dispute was about

• Asier Metals Private Limited, an operational creditor, supplied aluminium ingots to the company under a business relationship entered around December 2019, with purchase orders and advance payments for monthly shipments.
• The creditor claimed an outstanding operational debt of Rs. 2.78 Cr, saying part payments received were lower than the invoice amounts.
• It sent a demand notice under Section 8 of the Insolvency and Bankruptcy Code on 06.08.2026 for that amount, along with purchase orders, invoices and the ledger.
• The company sent a holding response on 19.08.2026 and a detailed reply on 02.09.2026, denying the alleged debt and pointing to pre-existing disputes over account reconciliation and competing claims.
• The creditor shared a Section 9 petition on 24.08.2026, and the NCLT bench admitted it on 07.10.2026. The company's suspended director then appealed to the NCLAT.

What the company argued in appeal

• Emails and messages before the demand notice, including an email dated 22.07.2026, dealt with provisional billing, credit-note discounts, detention and demurrage, and other reconciliation points.
• The operational creditor had assured credit notes but did not honour them, so the amount claimed had not crystallised into an undisputed debt.
• The NCLT should have applied the test laid down by the Supreme Court in Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd. (2018) 1 SCC 353, where a plausible, non-spurious dispute requires rejection of the Section 9 application.
• The company is fully solvent and listed, with substantial business operations and a large employee and shareholder base, and stand-alone revenue of Rs. 2,81,851.77 million during FY 2025-26, with bank credit facilities regular and classified as Standard Assets.

What the appellate tribunal examined

• The key question was whether communications showed pre-existing disputes between the parties under the Insolvency and Bankruptcy Code, and whether the NCLT had failed to examine them before admitting the petition.
• Counsel for the operational creditor admitted that communications preceding the demand notice, relied on by the company to show pre-existing disputes, were not examined by the NCLT in its order.
• The tribunal reproduced the statutory scheme in Sections 8 and 9 of the Code and the Supreme Court's reasoning in Mobilox, which requires the adjudicating authority to check only whether a plausible dispute exists, without judging its merits.
• It also reproduced extracts of the NCLT's reasoning, which had held that the correspondence did not support a pre-existing dispute and that an operational debt was due and payable with a default having occurred.

The outcome reported to the exchanges

• The company's intimation states that the NCLAT has allowed its appeal and set aside the October 07, 2026 order of the NCLT Ahmedabad Bench.

What this means for a retail shareholder

• The update is about a legal proceeding, not about the company's sales, margins or operations.
• The company has stated that the NCLT order admitting the Section 9 petition has been set aside, which removes the position created by that order.
• The dispute itself was over Rs. 2.78 Cr, an operational debt claimed by one supplier, and the company's stated stand-alone revenue for FY 2025-26 was Rs. 2,81,851.77 million.

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