TMI Blog2018 (1) TMI 1190X X X X Extracts X X X X X X X X Extracts X X X X ..... owers on the Adjudicating Authority, under section 9(5)(ii)(d) r/w Section 5(6) of IBC, 2016, we hereby rejected the Company Petition - CP (IB) NO. 226/09/HDB/2017 - - - Dated:- 19-12-2017 - MR . RAJESWARA RAO VITTANALA AND MR . RAVIKUMAR DURAISAMY, JJ . For The Petitioner : R . Raghunandan Rao, Sr . Adv . , Ms . B . Saroj and Ms . Kajal Kumari For The Respondent : Deepak Bhattacharjee, Sr . Adv . and Dishit Bhattacharjee ORDER Rajeswara Rao Vittanala, Member ( Judicial) 1. The Company Petition bearing C.P(IB).No. 226/09/HDB/2017 is filed by M/s. Tata Power Company Limited u/s. 9 of the IBC Code, 2016 r/w Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 by seeking to initiate Corporate Insolvency Resolution Process in respect of M/s. Meenakshi Energy Limited under IBC, 2016. 2. Brief facts, leading to the filing of present Company petition are as follows: (1) M/s. Meenakshi Energy Limited, (which is herein after referred to as Corporate Debtor) was initially incorporated on 21st August, 1996 under the Indian Companies Act, VII of 1913. (2) The Corporate Debto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional Creditor has handed over the charge of the complete O M Services (including all services in the scope of the O M Contract) of the 2x150 MW (Phase - I) power plant to the Corporate Debtor with effect from 24:00 hrs of 30th November, 2016 under protest and at the risk and cost of Corporate Debtor. Simultaneously, the Operational Creditor was compelled to issue letter dated 30.11.2016 to the Corporate Debtor raising the following points: (i) Termination of the O M Contract without giving mandatory notice period of 180 days is in complete breach of the O M Contract and the same is not acceptable. (ii) Not provided the payment plan for outstanding receivable of ₹ 22.05 crores which was equivalent to nearly 6 months of O M Fees. (iii) Ignored the request to suspend the notice for termination and terminate the contract without compliance to the dispute resolution process as per clause 15 of the contract. (7) In view of the abovementioned concerns raised between the parties, the Operational Creditor invoked the arbitration clause in terms of clause 15.3 of the Annexure - I of the O M Contract, nominating Mr. Justice (Retd.) Vilas Afzalpurkar and requested the Corp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave settled the dispute through conciliation and has entered into a Minutes of Meeting dated 12.01.2017 whereby both the parties have given a go-bye to the arbitration invoked. (12) Since no payments were forthcoming, the Operational Creditor sent an email dated 09.02.2017 requesting to release the payment for agreed instalments without any further delay. In reply to Operational Creditor s email, the Corporate Debtor on even date (09.02.2017) whilst admitting its liability towards the outstanding payment acknowledged its inability to pay the instalment due to the Operational Creditor in January 2017 on the ground that the Corporate Debtor did not have adequate cash inflow due to an unprecedented situation. (13) Thereafter, the Corporate Debtor whilst acting upon the Minutes of Meeting dated 12.01.2017 has paid an amount of ₹ 2.00 crores to the Operational Creditor on 06.03.2017. The Operational Creditor vide letter dated 21.03.2017 has acknowledged receipt of payment of ₹ 2 crores on 06.03.2017 from the Corporate Debtor towards the outstanding dues and requested to release the balance outstanding payments. In response thereto, the Corporate Debtor vide email dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n was not filed as per prescribed format it is also incomplete and suppressed several material facts. And it is contrary to the provisions of IBC Code, 2016. The operational creditor has not sent the notice under section 8 of IBC to the corporate debtor as per prescribed format in Form-3 of the code. The demand notice issued on behalf of the operational creditor is not in accordance with law. The operational creditor itself had invoked arbitration clause as per clause 15.3 of the agreement expressly recorded in the minutes of the meeting held during the period 2nd August 2011 to 12 August 2011 for the very same debt as stated in part IV of the application. The Operational Creditor vide its letter dated 30th November. 2016 invoked the Arbitration clause by nominating Justice (retd.) Shri Vilas Afzalpurkar as its Arbitrator. Similarly, the Corporate Debtor vide its letter dated 14.10.17 also has nominated Justice (retd.) Shri V. Eswaraiah as its Arbitrator to commence the arbitration. Both the parties have consented to nominate Hon ble Justice Shri P. Venkatram Reddy, former Judge of Supreme Court of India as Umpire in the Arbitration. Therefore, the petitioner has come to the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh conciliation and thus entered into a minutes of meeting dated 12th January, 2017, whereby both parties giving a go by to the arbitration invoked by paying an amount of ₹ 2 crores to the Operational Creditor on 6 March, 2017. He has further submitted as per clause 10.3.2.2 of the contract, interest shall be calculated at the prevailing SBI base rates per annum on the unpaid portion from the date on which such amount was due and payable by such party and till the date of payment by such party. In support of his case, he has relied upon the judgments of the Hon ble Supreme Court in the case of Haryana Telecom Ltd. v. Sterlite Industries (India) Ltd. [1999] 22 SCL 156 and AP Power Co-ordination Committee v. Lanco Kondapalli Power Ltd. [Civil Appeal No. 6036 of 2012, dated 16-10-2015]. He, therefore, claimed that the petitioner has fulfilled all conditions prescribed under the Code so as to initiate CIRP as prayed for. 6. Shri Deepak Bhattacharjee, the learned Senior counsel for respondent/Corporate Debtor, while reiterating contentions as raised in CA No. 186 of 2017, has further contended that in pursuance to the demand notice in question dated 17th August, 2017 issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to the debt and admittedly there is a dispute of arbitration pending and thus it is liable to be dismissed. 7. In the light of above discussion of the case, issues arise for consideration is whether the Company petition is maintainable and it is eligible to be admitted or rejected as per section 9(5)(i) or 9(5)(ii) r/w Section 5(6) of IBC, 2016 . In instant case, as discussed supra, the main issue, apart from other issues, for consideration of the Tribunal is that whether application/petition is liable to be rejected on ground of notice of dispute received by the Operational Creditor as mentioned under Section 9(5)(ii)(d) of the Code. Word dispute as referred above is defined under Section 5(6) of the Code, which reads as dispute includes a suit or arbitration proceedings relating to- (a) the existence of amount the debt; (b) the quality of goods or services or (c) the breach of representation or warranty. 8. As stated supra, in pursuance to the demand notice dated 17th August, 2017 issued by the Operational Creditor, the Corporate Debtor has sent its rely suitably answering all the issues raised therein ultimately denying the contentions made in the notice are fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve remedy. 9. Now, it is settled position of law that the Hon ble Supreme Court especially, in Mobilox Innovations (P.) Ltd. case, stated supra, has made clear the scope of dispute, default etc., as mentioned in IBC, 2016 so as to invoke jurisdiction of this Tribunal/Adjudicating Authority. The contention of the learned senior Counsel for the Operational Creditor that paying ₹ 2 Cr. amounting to settlement of the issue in question, is not at all tenable in view of reply given by the Corporate Debtor to Demand notice given by the Operational Creditor and appointment of third Arbitrator as stated supra. We have no doubt in our mind that there is a valid and legal dispute raised by the Corporate Debtor, and thus the case is liable to be rejected. 10. In the light of above discussion of the case and law, by exercising the powers on the Adjudicating Authority, under section 9(5)(ii)(d) r/w Section 5(6) of IBC, 2016, we hereby rejected the Company Petition bearing CP No. (IB) No. 226/9/HDB/2017. Accordingly, CA No. 186/2017 is disposed of. No order as to costs. However, this order would not come in the way of parties exploring solution to their issues before the Arbitration T ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
