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2020 (3) TMI 1262 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - pre-existing dispute or not - HELD THAT:- It is the settled principle of Law that if a notice of pre-existing dispute between the parties has been received by the Operational Creditor or there is record of disputes in the information utility the insolvency code cannot be applied. Thus, the applicant has not approached with clean hand rather suppressed the existence of pending disputes. Since the Respondent/Corporate Debtor by filing the reply to the demand notice dated 17th May, 2019 stated that there are existing disputes with regard to the outstanding payment and the same has been intimated by the management, therefore, we would like to consider this aspect at first, where dispute raised by the Corporate Debtor in reply to demand notice issued under Section (81) is a dispute in terms of Section 8(2)(a) or not? The objection was raised by Corporate Debtor on the invoice/bill submitted by the applicant prior to the date of issuance of the demand notice. We further find since on 6th June 2019. show cause notice under Section 6 of the Payment of Wages (amended) Act. 2017 was sent in which the correspondence made through the various email. Further, vide email dated 6th June. 2019, the Corporate Debtor has also informed the Operational Creditor that due to non-payment of salary, the staffs deputed by the Operational Creditor refused to join their service on 6th June, 2019 and they have gathered in front of the hospital near gate No. 1. Whether this dispute has been raised within the period prescribed under Section 8(2) of the IBC, 2016 or not? - HELD THAT:- Before receiving the demand notice, the Corporate Debtor has raised the disputes and the email exchanged between the two, which are prior to the issuance of the demand notice shows that there was a dispute regarding the amount claimed by the Operational Creditor and it has also come that the proper staff were not being deputed/posted by the Operational Creditor as per the agreement - there are no option but to hold that the Corporate Debtor has raised the dispute regarding the service and also regarding the payment made by the Operational Creditor to their employees/staff. It cannot be said that since there is a labour dispute and the matter is pending before the Labour Commissioner regarding the payment of the amount, therefore, that does not come under the purview of the dispute as under Section 8 and 9 of the IBC, 2016, rather, it can be safely said that the Corporate Debtor has raised the dispute, which is corroborated by the email exchanged between the two. prior to the delivery of the demand notice. Since there is existence of dispute, therefore, in order to admit an application under Section 9. this Adjudicating Authority is required to consider the ground mentioned at Section 9(5)(i) of the IBC, 2016, and if these conditions are not fulfilled then this Adjudicating Authority have no option but to reject the application under Section 9(5)(ii) - in the case in hand, notice of dispute has been received by the Operational Creditor and on the basis of documents enclosed with the application and reply, it is found that there is existence of dispute. The present application is dismissed.
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