TMI Blog2017 (9) TMI 855X X X X Extracts X X X X X X X X Extracts X X X X ..... he provision of Section 9(3) of IBC, 2016, inter alia, by providing a certificate from the bankers in relation to the unpaid debt coupled with the statement of accounts from 1.3.2016 for a continuous period up to 31.3.2017. Taking into consideration all the compliance as well, this Tribunal is per force required to come to a conclusion that an operational debt is owed by the 'Corporate Debtor' to the 'Operational Creditor' for the supply of goods which remain unpaid and which rightly entitles the 'Operational Creditor' to maintain the Petition. From the Application it is seen that under Part III of the same, the 'Operational Creditor' has left the choice of appointing Interim Resolution Professional to the Tribunal/Board. In the circumstances, by virtue of Section 16 of IBC, 2016 reference is made to Insolvency and Bankruptcy Board of India (IBBI) who will on receipt of the reference from this Tribunal recommend the name of the Insolvency Professional to this Tribunal as against whom no disciplinary proceedings are pending, within 10 days from the date of receipt of the reference. However, in view of the Petition being admitted, the moratorium as contemplated under Section 14 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ders placed by the Corporate Debtor were completed between July 2016 and August 2016. Having effected the supplies, the 'Operational Creditor' represents that it demanded the payment in the sum of ₹ 1,70,70,423 vide email dated 15.10.2016 and the 'Corporate Debtor' vide email dated 15.10.2016 accepted that there was delay in payment of the amount and sought for some more time to make the payment. Pursuant to the above promise on 20.10.2016 the 'Corporate Debtor' gave a Letter of Credit for ₹ 68,94,223 which seems to have been duly encashed by the Operational Creditor through its bankers. Subsequent to the same, in the month of November, 2016 the 'Operational Creditor'/Petitioner represents that an additional sum of ₹ 20.00 lakhs was also paid by the 'Corporate Debtor'. It is the claim of the 'Operational Creditor' that out of the total sum of ₹ 1,70,70,423, the 'Corporate Debtor' paid only ₹ 89,68,660 that too belatedly leaving a balance sum of ₹ 81,53,763 which remains unpaid. Despite repeated requests and reminders, since no payment was forthcoming from the 'Corporate Debtor' in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; in approving the format of Letter of Credit, as contended by the Corporate Debtor substantial time was being consumed in opening the LCs, as contemplated between the parties and a stage arose where due to non-supply of goods on the part of the 'Operational Creditor', execution of the project was getting delayed on day-to-day basis. However, in the meanwhile, the 'Operational Creditor' insisted for security till the time of opening of LC and in view of the same, two cheques were issued bearing Nos. 294916 and 294917 both dated 20.10.2016 of ₹ 68,94,223 and ₹ 1,01,07,853 respectively and it was subsequently brought to the notice of the 'Operational Creditor' that the cheques were issued only for the purpose of security and deposit of the same shall be made only with the concurrence of the 'Corporate Debtor'. Subsequent to the approval, it is contended by the 'Corporate Debtor' that irrevocable LC in favour of the 'Operational Creditor' to the tune of ₹ 71,04,263 towards the first purchase order was opened. In the circumstances, the LC having been sent to the bankers of the 'Operational Creditor' and duly rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the 'Operational Creditor' in relation to the first of the purchase order through LC. It is also contended by the 'Corporate Debtor' that on its part it has lodged a criminal complaint against the 'Operational Creditor' for the Commission of offences in relation to offence of cheating and criminal breach of trust and the said like offences and despite the Investigative Officer calling the officials of the Operational Creditor for conducting the enquiry, they have deliberately not joined in the enquiry process. It is also the contention of the Corporate Debtor that in relation to the notice of demand dated 15.4.2017, a reply has been given by the Operational Creditor dated 17.5.2017 which has not been disclosed by the Operational Creditor in the application and hence the Operational Creditor has not approached this Tribunal with clean hands and suppressed the material information and facts and in the circumstances the application is liable to be dismissed with costs. 6. We have considered the rival pleadings of parties. The fulcrum on which the defence of the 'Corporate Debtor' to stave off the Insolvency Resolution Process as sought to be unle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en legally assigned or transferred. Taking into consideration the above definition, it is clear that in order to qualify to file the Petition as an 'Operational Creditor', a debt must be due arising either out of supply of goods or services or a debt in respect of the repayment of dues arising under any law, and both to the Government whether it be Central, State Government or to a local authority and that a default has been committed in the payment of the said debt by the 'Corporate Debtor' and that in relation to the debt there is no dispute as to the existence of the debt, or to the quality of goods or services, or there is breach of representation or warranty. Keeping the above in mind and applying these to the circumstances of the case, we find that there is no dispute in relation to supply of goods made by the 'Operational Creditor' to the 'Corporate Debtor' nor has there been any grievance raised by the 'Corporate Debtor' about the quality of those goods supplied to the 'Corporate Debtor' by the 'Operational Creditor'. The 'Corporate Debtor' has also failed to point out in relation to any breach of representatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same does not fall within the definition of dispute as reproduced, as above, and the plea of dispute it is seen is only a moonshine as no where in the said notice the supply of goods nor amount owed to the Operational Creditor is denied. 10. In relation to the plea of criminal proceedings pending against the Corporate Debtor as initiated by the Operational Creditor for dishonour of cheques and stay of these proceedings by the Hon'ble High Court of Gujarat, we are afraid, we are not concerned with the same as the same is in relation to the dishonour of cheques and the criminality of dishonouring it under relevant law. The 'Corporate Debtor' after having received the goods and also utilizing the same for the project it has undertaken, cannot wish away the debt by mere denials and raising some specious plea. A strict onus is placed on the 'Corporate Debtor' while raising the plea of dispute and that it must be genuine and bona fide in order to avoid the debt, which is claimed by the 'Operational Creditor' as due from the 'Corporate Debtor' and in making payment of the same. However, in the instant case we do not find any merit in the contenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity; (b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. (2) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during moratorium period. (4) The order of this moratorium shall have effect from the date of such order till the completion of the corporate insolvency resolution process subject to proviso of Section 14 of IBC, 2016.: Subsequent to the appointment of the Insolvency Resolution Professional (IRP), the 'Operational Creditor' shall deposit with the Insolvency Resolution Professional such sums as may be required for defraying the costs of publication and such other ..... X X X X Extracts X X X X X X X X Extracts X X X X
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