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2021 (9) TMI 581 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - Operational Debt in terms of Section 5(21) of IBC, 2016 - any dispute exists between the parties that exist before the issuance of the Demand Notice by the Operational Creditor - foreign Award has become legal enforceable in India or not. Whether the debt of the Petitioner qualify to be an "operational debt" in terms of Section 5(21) of IBC, 2016 and as such the Petitioner would qualify to be an Operational Creditor in respect of the Corporate Debtor under the provisions of the IBC, 2016? - HELD THAT:- As to the facts of the present case, the right to claim money from the Corporate Debtor emanates from a SPA dated 19.09.2012, pursuant to which the Corporate Debtor had acquired the shares from the Operational Creditor. The transaction as transpired between the parties could have been treated as an 'operational debt' had it occurred in the 'ordinary course of business' of trading in shares by one seller and another purchaser, in which context the expression 'shares' would partake the characteristics of 'goods' as envisaged under the Sale of Goods Act, 1930. However, it is not so in the present case and the parties to the present proceedings are governed by a 'Share Purchase Agreement', and non - adherence/violation of the said terms and conditions envisaged thereunder, cannot be, under any circumstances, be treated as a claim in respect of the 'provision of goods' as defined under Section 5(21) of IBC, 2016 - the alleged 'debt' as claimed by the Operational Creditor in the present Application does not fall within the definition of the expression 'operational debt' as defined under Section 5(21) of the IBC, 2016. Whether there is any dispute exists between the parties that exist before the issuance of the Demand Notice by the Operational Creditor - HELD THAT:- There exists a 'dispute' between the parties before the issuance of the Demand Notice itself and the defence raised by the Corporate Debtor on the grounds of existence of a dispute cannot be considered as spurious, hypothetical, illusory or misconceived. Further this Tribunal in exercise of summary jurisdiction cannot adjudicate upon the dispute between the parties. Whether the Award passed by the Arbitral Tribunal, which is a foreign Award has become legal enforceable in India and if so what would be the consequences? - HELD THAT:- The Supreme Court in the matter of GOVERNMENT OF INDIA VERSUS VEDANTA LIMITED AND ORS. [2020 (9) TMI 1178 - SUPREME COURT] has held that a petition for enforcement and execution of a foreign award by way of a petition is required to be filed under Section 47 and a foreign award does not become a decree until and unless it passes the muster of Section 47 to 49, only after which it acquires the status of a decree. Only after the Court adjudicates on the enforceability of the foreign award under Section 47 to 49, the foreign award would deem to be a decree of the Court - However, in relation to the enforcement of 'Domestic' award that is not the case; in respect of the 'Foreign' Award, a further declaration is required to be made in respect of its enforcement and admittedly the award in the present case is yet to be enforceable under Section 47 to 49 of the Act, 1996. While this being the fact, and also by taking into consideration the divergent views expressed in this regard by NCLT Hyderabad Bench and Bombay Bench, this Tribunal does not wish to render its finding in relation to the said Issue. Issue decided in favour of the Corporate Debtor and against the Operational Creditor and that there exists dispute between the parties and also the 'debt' as claimed in the Application does not partake to the character of an operational debt - application dismissed.
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