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2021 (2) TMI 724 - AT - Insolvency and BankruptcyRecovery of disputed outstanding amount - default period is varying from over 200 days to approximately 500 days - allegation is of manipulation of accounts department - HELD THAT:- Keeping in mind the provisions of law laid down in the Code and the Hon’ble Apex Court Judgment which has made the provisions of applicability of the Code amply clear as far as initiation of proceedings by Operational Creditor against the Corporate Debtor is concerned, we are very much clear that the following facts are proved beyond doubt which has been complied with in accordance with the Hon’ble Apex Court Judgments and provisions of the Code. The debt became “due” from July 2018, the question is whether it became “payable” by the Corporate Debtor under the law, the answer is in “negative” because there were quality & other issues raised by the Corporate Debtor. The Operational Creditor has issued a Demand Notice dated 18.11.2019 received on 06.12.2019 by the Corporate Debtor and within the stipulated period, the Corporate Debtor vide its letter dated 09.12.2019 has replied and proved beyond doubt that there is an existence of dispute particular the cracks in the projects sites, reduced quality of goods supplied, short supply of concrete multiple snags in windows and doors etc & also raising issue to initiate arbitration proceedings for excess sum of over ₹ 9.51 Crore paid to the Appellant etc. This meets the criteria of genuine dispute raised within stipulated period. Accordingly, under Section 9(5)(ii)(d) Application needs to be rejected. The provision of the Code cannot be invoked for recovery of outstanding amount as well as it cannot be misused to drop the curtain on a healthy organization. The Objective of the Code is to consolidate and amend the laws relating to reorganization and Insolvency Resolution of Corporate Persons. Using the platform of the Code, threatening the vendor to release even disputed amount is not fair and equitable. There are no merit in the appeal and the Adjudicating Authority has rightly rejected the Application under Section 9 of the Code. The Appeal deserves to be dismissed and hence dismissed.
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