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2020 (12) TMI 420 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- The provisions of Code cannot be invoked for recovery of outstanding amount but it can be invoked to initiate CIRP for justified reasons as per the Code. The Hon'ble Supreme Court in the case of Mobilox Innovations Private Limited Vs. Kirusa Software Private Limited [2017 (9) TMI 1270 - SUPREME COURT], has inter alia, held that I&B Code, 2016 is not intended to be substitute to a recovery forum. The operational creditor cannot use the Code prematurely or for extraneous considerations or reasons as a substitute for debt enforcement procedures. It is also laid down that whenever there is existence of real dispute, the IBC provisions cannot be invoked. The Respondent has throughout denied/disputed the claims of the Petitioner, much before the demand notice sent on 02.01.2020. The Respondent contends that whatever demands were raised by the Petitioner for the services rendered by it, were either paid or adjusted long back by the Respondent against payments due from the Petitioner, as also borne out from the various emails exchanged between the two sides. In its mail of 10.04.2010 the Petitioner had accepted that all the demands had been paid. Subsequent dues were also cleared. No case has also been made out that the Respondent is an insolvent entity that has lost its ability to run its business, generate revenue or repay its debts. This is not a case where the insolvency of the Corporate Debtor needs to be resolved by initiating CIRP, which is the objective of the Code in inserting the provisions contained in sections 7 and 9. Recourse to the Code does not entail or intend pushing viable units into insolvency. There is no clear and undisputed debt, there is a pre-existing dispute, that this Tribunal cannot be used as a recovery forum, and that no case has been made out to our satisfaction that the Respondent is insolvent and is unable to pay its debts, the petition is liable to be dismissed - Petition dismissed.
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