Trade Receivables, Cheque Bounce & IBC
for Corporate Creditors

Generally, DRT jurisdiction under the RDDB Act is available only to "banks and financial institutions" as defined in Section 2(d). However, large corporate creditors with significant NPA on their books — such as manufacturers with dealer finance exposure, infrastructure companies with sub-contractor dues, or real estate companies with buyer defaults — can use IBC Section 9 as operational creditors (for trade dues) or DRT where they qualify as a "financial institution" by virtue of specific business activities. Unified Chambers advises corporates on the most effective forum for each debt profile.

For trade receivables, the primary options are: (1) Section 138 NI Act prosecution where payment cheques have been issued and dishonoured; (2) Summary suit under Order XXXVII CPC in the Civil Court or Commercial Court for liquidated debts; (3) IBC Section 9 CIRP petition before NCLT as operational creditor for defaults above ₹1 crore; (4) Commercial arbitration where the contract provides an arbitration clause. Unified Chambers recommends the optimal combination based on the contract terms, security available, and amount.

Yes. Unified Chambers handles high-volume Section 138 NI Act prosecution programmes for corporate creditors — including FMCG companies, auto manufacturers, pharmaceutical companies, and infrastructure developers with dealer/distributor cheque bounce exposure. We offer a structured intake process, batch-filing of complaints, centralised demand notice drafting, and monthly recovery MIS. Speak to us about a bulk-matter retainer arrangement.

Yes. An operational creditor — which includes any party owed money for goods/services under a commercial contract — can file a Section 9 CIRP petition before NCLT for defaults above ₹1 crore. The corporate must issue a statutory demand notice (Section 8 IBC) and wait 10 days before filing. Unified Chambers has filed Section 9 petitions for corporate operational creditors including manufacturers, developers, and service providers.

Order XXXVII CPC (Code of Civil Procedure) allows a summary suit — a fast-track civil suit for recovery of a liquidated sum on a written contract or negotiable instrument. Unlike IBC which leads to insolvency proceedings, an Order XXXVII suit results in a money decree which can then be executed. It is better where: (a) the debtor is solvent, (b) the amount is below ₹1 crore, (c) you want a money decree rather than insolvency, or (d) the debtor dispute would complicate IBC proceedings.

Yes. The firm has a dedicated cross-border practice for: (a) Indian exporters with unpaid foreign-buyer invoices (post-shipment recovery, ECGC claims, foreign-buyer enforcement), and (b) foreign creditors with Indian-debtor receivables (Section 44A CPC enforcement of judgments from reciprocating territories — UK, Singapore, UAE Abu Dhabi; Section 13 CPC fresh suit for non-reciprocating jurisdictions — US, EU, Canada). The Dubai desk supports UAE and GCC creditors with Indian-debtor exposure.

For corporate creditors with bulk cheque-bounce exposure (FMCG distributor defaults, auto-dealer dishonours, pharma-distributor receivables, infrastructure-vendor cheques), the firm operates a dedicated programme: centralised intake via secured portal, batch demand-notice drafting under Section 138(b), Magistrate-court mapping by jurisdiction, batch complaint filing, Section 143A interim compensation applications at first hearing, and monthly recovery MIS reports per dealer/distributor. Programmes scale from 50 to 5,000+ cheques per quarter.

Sectoral coverage: FMCG and CPG (dealer/distributor receivables, sales-tax disputes), pharmaceutical (CFA receivables, hospital/pharma-distributor defaults), automotive (dealer finance default, OEM-dealer receivables), real estate (buyer-default recovery, contractor dues), infrastructure (sub-contractor dues, EPC receivables, NHAI/PWD vendor recovery), IT/ITES (corporate-customer service receivables, SaaS subscription default), and manufacturing (vendor-customer dual receivable management). Each sector has distinct contractual structures and forum strategy implications.