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2021 (6) TMI 760 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - application was dismissed on the ground of pre-existing dispute - HELD THAT:- The Demand Notice has to be responded to within 10 days, as required in Section 8(2) for the purpose of bringing to the notice of the operational creditor the existence of a dispute or evidence of repayment of operational debt. The Corporate Debtor has not done so, prompting the operational creditor to take action as per Section 9 (1). Later during hearing before the Adjudicating Authority, the Corporate Debtor raised the issue of existence of a dispute. It appears to be a spurious dispute, raised to ward off the responsibility of repayment of debt as claimed by the operational debtor - The doubtful nature of dispute can also be inferred from the fact that Ld. Counsel of Respondent (Corporate Debtor) has stated in arguments that he had sent emails regarding the high percentage of wastage of newsprint on 28.9.2016, 5.10.2016, 25.5.2017, 2.7.2018 and 9.8.2018. The first invoice that is included in the demand notice which is due for payment is of 22.2.2018. All the other invoices included in the demand notice are of dates later than 22.2.2018 - It is not clear why the same issue is raised again by the corporate debtor for later invoices. It appears that this issue has been shown as a pre-existing dispute as an afterthought by the Respondent. While there is dispute about the rate of interest claimed by the Appellant it does not significantly alter the quantum of unpaid debt, which will remain to be above Rs. One Lakh. Thus, the application is maintainable on account of the unpaid debt being more than Rs. One Lakh, the threshold amount. Appellant not printing the newspaper for 16 days and the loss incurred by the Respondent on this account - HELD THAT:- The Clause 3 of the agreement stipulates that the responsibility of supplying newsprint lay with the Corporate Debtor. Hence this issue does not provide any help to the Respondent in his case. High percentage of wastage of newsprint in printing - HELD THAT:- The said agreements make it very clear that the minimum number of chargeable copies will be 10,000. In addition, the said agreements also stipulate that the wastage will be less than 4%. This wastage, quite obviously, is in relation to printing of 10,000 copies. It is understood that in printing jobs as the number of copies increase the quantum of wastage decreases and, conversely, as the number of copies decrease the quantum of wastage increases - It is, therefore, logical to expect that the later invoices should also have been settled on the same principle. Hence, we find the insistence of the Respondent that the Appellant should provide clarification for higher wastage to be superfluous and according to us this dispute does not fall in the category of preexisting dispute. Submission of dispute to arbitration - HELD THAT:- The matter was not referred for arbitration by either of the parties. This issue of possibility of arbitration has been raised at the appeal stage. It is not for this tribunal to direct the parties to go for arbitration. The Appellant and the Respondent continued in their relationship of Corporate Debtor and Operational Creditor even after 3.12.2017 and hence effectively the agreements continued to bind the parties. The Corporate Debtor accepted the invoices raised on and after 22.2.2018 and in various emails kept on promising to make payments and buying time for making payments - Appellant’s application under Section 9 of IBC satisfies all the ingredients as laid down in law. The same deserved to be admitted. The matter is remitted back to the Adjudicating Authority. The Adjudicating Authority will admit the application (unless parties settle dispute before such Order), and pass further consequential directions as per provisions of IBC - Appeal allowed.
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