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2020 (7) TMI 234 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor Failed to make repayment of its debt - existence of debt and dispute or not - HELD THAT:- From the facts and records, it is emphatically clear that there is serious dispute between the parties which are prior to issuance of Demand Notice. Neither the Adjudicating Authority nor this Appellate Tribunal sitting in a summary jurisdiction can go into those issues which otherwise required regular trial. It is mandatory that the Operational Creditor on the occurrence of a default, deliver a Demand Notice of unpaid operational debt, copies of invoices demanding payment of the amount involved in the default to the Corporate Debtor in such form and manner as may be prescribed. The Corporate Debtor shall, within a period of 10 days of the receipt of the Demand Notice or copy of the invoice mentioned in Section 8(1) of IBC bringing to the notice of the Operational Creditor regarding existence of a dispute (if any) record of pendency of the suit or the arbitration proceedings filed before the receipt of such notice or the invoice in relation to such dispute. In the present case, admittedly, there are disputes between the Appellant and the Respondent which is evident from the records - From the FIR lodged by the Appellant prior to sending of Section 8 Notice and the Respondent disputed the debt to be payable by the Respondent in their reply to the Demand Notice. The moment there is an existence of a prior dispute, the Corporate Debtor gets out of clutches of the rigors of the Court. Further the adequacy of dispute is only to be seen whether the dispute raised by the Corporate Debtor specifies as a dispute as defined under section 5(6) of IBC. In view of Section 9(5)(ii)(d) of the IBC on the ground that there is a record of dispute existence between the parties, which dispute is serious in nature - there is pre-existing dispute between the parties which cannot be adjudicated in a summary proceeding - Appeal dismissed.
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