NCLT Ahmedabad Admits Fettech Commercial Enterprises' Insolvency Plea Against Mercury Trade Links

The Ahmedabad Bench of the National Company Law Tribunal (NCLT) on 1 September admitted the insolvency petition filed by Fettech Commercial Enterprises Pvt. Ltd. against Mercury Trade Links Ltd.

A Bench comprising Judicial Member Chitra Hankare and Technical Member Dr VG Venkata Chalapathy observed:

“...we are satisfied that there exists an operational debt of Rs.2,70,00,000/- and that a default has occurred. The debt is due and payable, the demand notice has been served to the CD and no genuine preexisting dispute has been established by the Corporate Debtor.”

Fettech Commercial Enterprises supplied agricultural produce to Mercury Trade Links between April and December 2024. Against total supplies worth Rs. 4.41 crore, Mercury Trade Links paid Rs. 1.71 crore, leaving an outstanding amount of Rs. 2.70 crore.

The invoices carried a 90-day credit period, making the debt due on 31 March 2025. Fettech Commercial Enterprises issued a demand notice on 15 November 2025, which was delivered on 18 November 2025. Mercury Trade Links neither made the payment nor raised a dispute. The creditor thereafter approached the Tribunal under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), which permits an operational creditor to initiate the corporate insolvency resolution process (CIRP) upon a default in payment of an operational debt.

Mercury Trade Links contested the petition, alleging pre-existing disputes concerning delayed supply and inferior quality of the goods. It argued that reconciliation of accounts would reduce the liability below Rs. 2 crore and submitted that such commercial disputes could not be decided summarily in proceedings under the IBC.

The corporate debtor also questioned the creditor's authority to institute the petition and cited financial difficulties arising from unseasonal rains and losses in agricultural trade.

Fettech Commercial Enterprises argued that the goods had been received without any dispute and that Mercury Trade Links had not produced documentary evidence to support its allegations.

The Bench examined the invoices, demand notice and pleadings and found that the goods had been supplied and received, with the invoices providing for payment within 90 days. It also noted that the outstanding debt of Rs. 2.70 crore exceeded the statutory threshold prescribed under Section 4 of the IBC for initiating CIRP.

It further noted that the demand notice had been duly served and that Mercury Trade Links neither replied to the notice nor produced documentary evidence establishing a pre-existing dispute. It rejected the plea that the accounts required reconciliation, noting that the plea was raised only after the demand notice and filing of the insolvency petition.

The Tribunal concluded that an operational debt existed, a default had occurred and no genuine pre-existing dispute had been established.

Accordingly, the NCLT admitted the petition, appointed Manish Kumar Bhagat as the Interim Resolution Professional and imposed a moratorium under the IBC.