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2020 (10) TMI 918 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - discrepancy in the demand notice - stand of the Appellant is that the amount in default as specified in the Demand Notice is to be in consonance with the Application filed and the ‘invoices’ sent - Appellant submits that the ‘Adjudicating Authority’ had failed to consider the fact that the material defect in the ‘Demand Notice’ is fatal to the facts of the present case - HELD THAT:- In a given petition filed by the ‘Operational Creditor’ there is a heavy burden on the ‘Corporate Debtor’ to show that the dispute is a real and genuine one. Further, where a petition of the ‘Operational Creditor’ was opposed by the ‘Corporate Debtor’ on the ground that the dispute existed between the parties regarding the quality of the goods supplied but failed to raise the dispute within ten days of the receipt of ‘Statutory Notice’ under Section 8 of the ‘I&B’ Code, it is held that the petition is maintainable - If a dispute truly exists in fact and is not a hypothetical or an illusory one, then, the ‘Adjudicating Authority’ is to reject the Application. A defence being a mere bluster can also be rejected by an ‘Adjudicating Authority’. It cannot be lost sight off that an unpaid ‘Demand Notice’ is evidence of Debtor’s inability to pay its debts for the purpose of bankruptcy proceedings and it is a just ground for a creditor to justify the filing of the petition. An ‘Adjudicating Authority’ is not to decide how much due is. Further, an ‘Adjudicating Authority’ is required to examine before admitting or rejecting an application u/s 9 of the Code as to whether the ‘dispute’ raised by the ‘Corporate Debtor’ qualify as a ‘dispute’ as defined under sub-section (6) of Section 5 and whether notice of ‘dispute’ given by the ‘Corporate Debtor’ satisfies the conditions prescribed in sub-section (2) of Section 8 of the Code. Further, the existence of an ‘undisputed sum’ is a condition precedent for initiating ‘Corporate Insolvency Resolution Process’ - In the present case, no reply was issued to the ‘Demand Notice’ dated 06.04.2018 of the First Respondent / ‘Operational Creditor’ by the ‘Corporate Debtor’ and this is clearly an adverse circumstance against the Appellant, in the considered opinion of this Tribunal. In Law, an ‘Adjudicating Authority’ is safely and surely to admit the Application, if the ‘debt’ is proved and the default took place, the only rider being, that the Application must be complete as per the ingredients of the Court. Before the ‘Adjudicating Authority’ the Application was filed on 06.04.2018. The outstanding amount was ₹ 9,42,841/- as on 22.09.2017 and hence, the Application filed was well within limitation. Suffice it for this Tribunal to point out that the impugned order passed by the ‘Adjudicating Authority’ in admitting the application filed by the First Respondent / ‘Operational Creditor’ does not suffer from any material irregularity or patent illegality in the eye of Law. Appeal dismissed.
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