TMI Blog2018 (5) TMI 1613X X X X Extracts X X X X X X X X Extracts X X X X ..... t of jural relationship is MSA, in that MSA itself there is a clause (24.1) saying that any alteration or modification to MSA will arise only when a new instrument has been entered into between the parties. Since no such instrument has been executed, it can never be called as novation. Moreover, mere assurance or promise of clearing liability by one party to other party can never become a novation, therefore, this novation argument propounded by the counsel of Corporate Debtors is no doubt novation but bereft of any merit - the default in making repayment has remained the same till date as before, therefore, this Bench hereby holds that Ericsson has proved that not only debt is in existence but also the default. Whether any dispute is in existence as on the date of receipt of section 8 notice by these Corporate Debtors? - Held that: - there are two issues, one is the claim made by the Ericsson against the corporate debtors, another is a dispute before Arbitral Tribunal in respect to termination of MSA. Termination of MSA is subsequent to receipt of section 8 notice, the cause of action for filing Insolvency Bankruptcy cases and the cause of action for invoking arbitration are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sel Mr. Hormuz Mehta Mr. Soumitra Majundar i/b J. Sagar Associates COMMON ORDER Per: B.S.V. Prakash Kumar, Member (Judicial) These are three separate Company Petitions 1385/2017 against Reliance Infratel Ltd, (RITL); 1386/2017 against Reliance Telecom Ltd. (RTL), and 1387/2017 against Reliance Communications Ltd. (RCom) filed by the same Petitioner, namely Ericsson India Pvt Ltd (in short Ericsson ) u/s 9 of Insolvency Bankruptcy Code, 2016 for having defaulted in paying Ericsson to the services rendered by it in terms of Managed Services Agreement (MSA) dated 25.01.2013 entered between these group of companies/Corporate debtors (collectively addressed as Reliance ), in view of the same, Ericsson filed these Company Petitions for the ascertained claim made against each of these corporate debtors, for they collectively failed to pay ₹ 9,78,72,06,974 - the dues admittedly outstanding as on 31.03.2017, henceforth Ericsson filed separate company petitions against each of these three Reliance Companies for initiation of Corporate Insolvency Resolution process against RITL (CP1385/2017) for defaulted in paying ₹ 427,21,40,509, against RTL (CP1386/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, mobile and fixed broadband, operations and business support services, cable television, IPTV, video systems, and an extensive services operation. 8 . Ericsson India Pvt Ltd (it is called as Managed Service Provider (MSP) in the MSA dated 25.01.2013) is a subsidiary of Swedish Ericsson, incorporated in 2008. Owing to its expertise in providing technical services of maintaining and optimising the network for wireless, maintaining the optical fibre network and managing passive infrastructure of towers, shelters and generators,, Reliance having Tele-communication infrastructure such as towers and optic fibre network across India, to manage services to it, Reliance entered into the MSA with Ericsson on 25.1.2013 for availing the Managed Services aforementioned, in pursuance thereof, according to Ericsson, it deployed thousands of employees for rendering services as agreed between the Ericsson and Reliance. 9. According to Ericsson, the revenue basically generated from this business from the subscribers of Corporate Debtors/telecom operators for using voice or data services- the subscribers use the services and pay to mobile operators for using the telecom services. In India, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 126 181 158 158 162 250 86 3.1 For Current Outstanding 61 61 38 38 32 32 32 3.2 For old outstanding 382 30 65 120 120 120 130 130 54 4 Due Payable (1+2+3) 678 707 767 827 762 642 522 402 272 54 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iance are as follows: Reliance To Date Apr 28th 2017 Dear Sir/Madam, For the purpose of the audit of our accounts, we would be grateful if you could confirm the balance due to you as on March 31, 2017 directly to our auditors: Sr. No. Purpose of Billing Amount 1 Managed Services Rs.9,78,72,06,974/- If you are unable to agree to the above balance, please respond directly to our auditors, giving full details of the difference. Thank you for your co-operation, Yours faithfully, Stamp of the company To To Kind Attn: Aseem Sharma Kind Attn: Pradeep Khandelwal Chaturvedi Shah BSR CoLLP 714-715, Tuisiani Chambers, 5th Floor Lodha Excelus, 212, Nariman Point, Apollo Mills Compound, Mumbai-400021. N. M. Joshi Marh, Mahal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4.2 WCT Not Accounted by Ericsson 840,980 336,392 504,588 1,681,960 4.3 ST on SRiR/GRIR Not Accounted by RCOM Group 14,723 1,034,584 1,049,307 4.4 ST on SEM Not Accounted by RCOM Group 82,456,071 19,018,064 36,085,065 137,559,200 4.5 Invoice pertaining to Mar 17 accounting done in Apr 17 by Ericsson -350,101,382 -48,602,728 -276,652,163 -675,356,273 4.6 Reconciliation Pending -951,714 -8,842,460 55,143,392 -64,937,567 5 Sub Total -184,152,357 -22,152,271 -193,183,126 -399,487,753 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nintended yet unfortunate situation. Strategic Steps Taken We are taking strategic measures to ensure the interests of all our partners are well protected. In this regard, we have taken deleveraging initiatives and made substantial progress with respect to the announced strategic transactions. 1. Combination of the Wireless business with Aircel .......................... 2 . Sale of Tower Assets. . . . . . . . . . . . . . . . . . . . . . . As you will observe from the above, the completion of the two major transactions is mere procedural in nature. We are confident to complete the transactions by September 30, 2017. Way forward Firstly, we are thankful to your client for their continued support and co operation and we also appreciate their patience. Reliance has been equally understanding of the stressful situation in which the contract is working. The deferred payments are accruing interest as stipulated in the contract Ericsson s managed services performance has been inconsistent and there is significant scope for improvement However, we continue to recognise the reasonable effort being put instead of strict enforcement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscussions between Ericsson India Private Limited ( Ericsson ) and Reliance Communications Limited and Reliance Infratel Limitted ( Reliance ) for payment of outstanding dues under Managed Services Contract dated 25th Jan 2013. 1. From July onwards, we are moving to weekly advance payments as agreed i.e. ₹ 14 Cr per week. Please consider this run rate as proforma which may change pending any optimization or divesture initiatives which we expect to complete by 30 Sep 2017. 2. On the June and July payments to clear April and May backlog, we are to pay R.125 Cr. We have duly signed an agreement with Reliance Jio for the same of MCNs for ₹ 211 Cr, which provides more than sufficient cash to meet that commitment. As part of our ongoing Strategic Debt restructuring programme, out Lenders held a meeting on Friday, 23rd June, 2017, wherein they have advised us, for the first time that any sale of property needs their specific prior approval. We have immediately made the formal request and expect to receive the approval within a week to 10 days, and will accordingly pay ₹ 125 Cr well before 31st July, 2017. You will appreciate that this requirement of specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -Oct-17 50.6 11 13-Oct-17 50.6 12 20-Oct-17 50.6 13 27-Oct-17 50.6 14 03-Nov-17 50.6 15 10-Nov-17 50.6 16 17-Nov-17 50.6 17 24-Nov-17 50.6 18 01-Dec-17 50.6 19 08-Dec-17 50.6 20 15-Dec-17 50.6 Sub-Total (C) 1,012.0 14. Reliance also sent another letter on 29th June 2017 stating that they are committed with other timings of pay outs with a requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 25.1.2013 claiming declaration with regards to the termination of the MSA by Ericsson on 07.09.2017, which according to Reiiance is unlawful and not in accordance with the terms of the MSA by further claiming damages for abrupt walk out of Ericsson from providing the services to Reliance under the MSA causing huge losses to Reliance, On having Ericsson received notice in the Arbitration Application; Ericsson filed its counter claim mentioning the dues payable by Reliance to Ericsson. On hearing the interim application, Arbitral Tribunal headed by Hon ble Justice S.B. Sinha (Retd. Supreme Court Judge) passed an interim order on 05.03.2018 restraining the Corporate Debtors from transferring, alienating, encumbrance or disposing of its assets without specific permission/leave of the Arbitral Tribunal making it clear that the order is without prejudice to any order that may be passed by the Board or Boards of competent jurisdiction. When this order was assailed before Hon ble High Court of Bombay, it was affirmed without interfering with interim direction given by the Tribunal. Assailing the same, when SBI filed an appeal before Hon ble Supreme Court of India, it has been held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regular payments along with arrears payable to Ericsson. To prove that the claim made by Ericsson has not been paid by RITL, Ericsson has filed the certificate given by its banks, HDFC Bank as well as Citi Bank to establish that RITL failed to pay the defaulted claim amount to Ericsson. For the outstanding due not being paid, Ericsson filed this Company Petition before NCLT Mumbai on 11.09.2017 with the particulars above mentioned. 19. To avoid repetition, the facts already mentioned above have not been repeated in each of the petitions, because except figures, facts to all these petitions are one and the same. CP 1386/2017 20. Ericsson filed this Company Petition against RTL u/s 9 of IBC stating that for having RTL defaulted in paying ₹ 114,54,46,238 as on 31.03.2017 towards the services rendered by Ericsson, this Company Petition is filed to initiate Corporate Insolvency Resolution Process (CIRP) against RTL. 21. This RTL is another subsidiary of RCom, engaged in providing wireless and wire line, convergent (voice, data and video) digital network. It did not enter into the MSA along with RCom and RITL, but it has entered into a deed of adherence dated 25.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge this network spread among these three companies, it has engaged Ericsson by entering into MSA on 25.01,2013 because MSP (Ericsson) is in the business providing telecommunication network operations, maintenance and its related managed services. As Ericsson kept on providing managed services to these Corporate Debtors including this Corporate Debtor, when this Corporate Debtor defaulted in paying the admitted claim of ₹ 436,96,20,227, Ericsson issued section 8 notice on 07.05.2017 stating that this Corporate Debtor defaulted paying the aforesaid amount therefore, notifying it to the Corporate Debtor that if at all any dispute is in existence in respect to unpaid operational debt, it may be informed within 10 days of receipt of section 8 notice, failing which, Ericsson would initiate Corporate Insolvency Resolution Process (CIRP) in respect to this company. 26. As I already stated that Reliance gave a common reply on 19.05.2017 explaining its problems to the Ericsson and also asking to remain patient for some more time until issues have been resolved. In addition to it, on 28.06.2017, sent another letter promising the petitioner that it would make advance payment on weekly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 18,100crores which could, directly come to the secured creditors in stages. The counsel has further pointed out that RBI had issued a fresh circular dated 12.02.2018 in respect to stress assets leaving open with two options either for restructuring in case of viable units or else to file insolvency filing in case of unviable units. In the said circular, it is further stipulated that if the restructuring not implemented within 180 days from 01.03.2018, Joint Lenders Forum (JLF) is mandated to file an insolvency application under IBC. In this scenario, the counsel submits, if these petitions are admitted, the operational creditor being admittedly unsecured creditor, in any event, Ericsson cannot lay its claim over the assets which are charged to the secured creditors unless the entire dues of the secured creditors are paid. The counsel submits that this Tribunal should look into the balance of equity as to whether admitting these Company Petitions will result in jeopardising the interest of the secured creditors, especially considering that even after sale of assets of RCom consolidated, the secured lenders still have to recover over ₹ 24,000crores from RCom consolidate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment detailing in how many instalments it would pay to Ericsson, all this correspondence amounts admission of not only existence of debt but also existence of default. It is not out of context to mention that Reliance has not disputed the statement made on 28.04.2017 stating that as per Reliance Books, the balance due and payable to Ericson as on 31.03.2017 is ₹ 978,72,06,974, the same is the claim made by Ericsson. 35. As per the letter dated 28.04.2017, the due outstanding in aggregate against these three Corporate Debtors as on 31.03.2017 was ₹ 978,72,06,974 which separately has come to ₹ 436,96,20,227 against RCom, ₹ 427,21,40,509 against RITL,Rs. 114,54,46,238 RTL. Ericsson has stated that though the claim against these companies in its books showing more than what has been admitted by these Corporate Debtors, it has claimed only the amounts admitted by Reliance in the confirmation letter sent to the petitioner on 28.04.2017. Even thereafter also, there is not even a whisper from the Corporate Debtors side stating that the Corporate Debtors have dispute in respect to the debt amount claimed by Ericsson, or in respect to the quality of goods or se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lier demand u/s 8 of IBC would no more remain in existence because Ericsson itself stated in the termination notice that Reliance failed to adhere to make payment as per the plan given by them. 38. This counsel has further propounded an argument saying that this understanding of rescheduling of payment is novation to the earlier default; thereby the default present as on date of receipt of section 8 notice could not become a cause of action to file this company petition, henceforth these petitions liable to be dismissed. 39. As to this argument of extinguishment of default, it is evident that default is in existence as on the date of issuing section 8 notice, ever since the corporate debtors received section 8 notice, they have made several times several promises that payments were likely to happen. Now the point for discussion is as to whether such break-up of payments conveyed to Ericsson will amount to extinguishment of default occurred u/s 8 of the Code. Whenever any default in making payment happens, that default will become good only when payment has been made. It cannot be that if further assurance is given or schedule has been given assuring other side that payment wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice of an unpaid operational debt or copy of an invoice demanding payment of the amount involved must be delivered in the prescribed form. The corporate debtor is then given a period of 10 days from the receipt of the demand notice or copy of the invoice to bring to the notice of the operational creditor the existence of a dispute, if any. We have also seen the notes on clauses annexed to the Insolvency and Bankruptcy Bill of 2015, in which the existence of a dispute alone is mentioned. Even otherwise, the word and occurring in Section 8(2)(a) must be read as or keeping in mind the legislative intent and the fact that an anomalous situation would arise if it is not read as or . If read as and , disputes would only stave off the bankruptcy process if they are already pending in a suit or arbitration proceedings and not otherwise. This would lead to great hardship; in that a dispute may arise a few days before triggering of the insolvency process, in which case, though a dispute may exist, there is no time to approach either an arbitral tribunal or a court. Further, given the fact that long limitation periods are allowed, where disputes may arise and do not reach an arbit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is not a particularly high one. I am for present purposes content to adopt any of the standards that are referred to in the cases ... The highest of the thresholds is probably the test enunciated by Beazley J, though for myself I discern no inconsistency between that test and the statements in the other cases to which I have referred. However, the application of Beazley J s test will vary according to the circumstances of the case . 43. To know what the ratio in the case supra is, we must recapitulate the historical facts and interpretation given by the Hon ble Supreme Court, before looking into as to whether the case facts and legal proposition decided in the case are applicable to this case or not. 44. Mobilox is the first case on section 9 of IBC decided by Honourable Supreme Court and land mark judgement passed by Honourable Supreme Court for the reason that it has decided that to take in that the dispute shall have to be considered in existence if there is material reflecting that parties are at dispute over the claim even when suit or arbitration is not pending as on the date of receipt of notice by saying that the conjunctive and employed in between the existence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd had thus breached the NDA. The correspondence between the parties finally culminated into notice dated 12thDecember, 2016 sent under Section 271 of the Companies Act, 2013 by Kirusa. Presumably because winding up on the ground of being unable to pay one s debts was no.longer a ground to wind up a company under the said Act, a demand notice dated 23rdDecember, 2016 was sent for a total of ₹ 20,08,202.55 under Section 8 of the new Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the Code). By an e-mail dated 27thDecember, 2016, the appellant responded to the aforesaid notice stating that there exist serious and bona fide disputes between the parties, that the notice issued was a pressure tactic, and that nothing was payable inasmuch as the respondent had been told way back on 30th January, 2015 that no amount will be paid to the respondent since it had breached the NDA. An application was then filed on 30th December, 2016 before NCLT Mumbai u/s 8 and 9 of IBC stating that an operational debt of ₹ 20,08,202.55 was owed to the respondent (Kirusa). On 27th January, 2017, this Tribunal dismissed the aforesaid application in the following terms: On peru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reason for dismissal of the case because in the month of January 2015 itself Mobilox sent e-mail to Kirusa stating that Kirusa violated Non-Disclosure Agreement (NDA) entered in between Kirusa and Mobilox by saying that Kirusa put it in its website stating that it was working for Star TV, when this decision was assailed before Hon ble NCLAT, the order of NCLT was reversed stating that the dispute raised by Mobilox is vague, got up and motivated to evade the liability. On that observation, the Hon ble Supreme Court held that the correspondence between the parties would show that on 30.01.2015, Mobilox clearly informed Kirusa that it had displayed Mobilox confidential client information and claimed campaign to itself on a public platform (website) which constituted breach of trust and breach of the NDA between the parties, for this reason, that all the amounts that were due to Kirusa were withheld till the time the matter resolved, on which on 10.02.2015, Kirusa responded denying breach of NDA dated 26.12.2014, saying so, Kirusa demanded Mobilox to pay a sum of ₹ 19,08,202.57, to which again, Mobilox replied on 26.02.2015 expressing that it had lost business from various clien ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e dispute saying that Mobilox would not pay for having disclosed information not supposed to disclose under NDA therefore not liable to pay to the invoices raised by Kirusa. 52. But that is not the case here, Reliance right from the beginning, never raised any dispute, not even communicated that they have some difficulty in the services rendered by Ericsson, all through what Reliance continuously saying is that it would pay money at times on weekly basis, at times on monthly basis, sometimes saying that they would pay money in advance simultaneously assuring to clear the backlog of arrears, which is a diagonally opposite to the factual matrix of Mobilox. Did Reliance ever raise at any point of time that there is a dispute with Ericsson in respect to the claim Ericsson raised? No. 53. Therefore, the ratio decidendi in Mobilox is based on the above factual matrix, that is about dismissing section 9 petition based on a dispute Mobilox raised under section 5 (6) (c) of IBC almost two years before giving notice under section 8 of IBC, when Honorable NCLAT not accepted NCLT on the ground suit or arbitration not pending as on the date of receipt of section 8 notice, not on the groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ratio decidendi constitute obiter dicta and are not authoritative. (See Divisional Controller, KSRTC v. Mahadeva Shetty(20Q3 (7) SCC 197) 55. In Girnar Traders v. State of Maharashtra, [2007] 7 SCC 555, Honourable Supreme Court held: Thus, observations of the Court did not relate to any of the legal questions arising in the case and, accordingly, cannot be considered as the part of ratio decidendi. Hence, in light of the aforementioned judicial pronouncements, which have well settled the proposition that only the ratio decidendi can act as the binding or authoritative precedent, it is clear that the reliance placed on mere general observations or casual expressions of the Court, is not of much avail to the respondents. 56. I don t even say that Hon ble Supreme Court has stated that simply it being an operational debt, even if a contention of dispute is raised at any point of time, qua being mentioned, section 9 petition is to be dismissed. If that is the case, Hon ble Supreme Court would not have further discussed over this aspect in section 45 and 46 as below: 45. Going by the aforesaid test of existence of a dispute , it is clear that without going into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall not be spurious, mere bluster, plainly frivolous or vexatious, a dispute shall truly exist in between the parties, which may or may not ultimately succeed. Here in this case what dispute is pending in respect to the claim, nothing. 58. As I have already mentioned that Reliance invoking arbitration assailing the termination notice is altogether different from the admitted claim upon which Ericsson initiated IBC proceedings. If at all it has to be assumed as dispute between the parties, it would become a dispute over the termination of MSA, not in respect to the money claim raised by Ericsson, which I should not forget to say that the claims in the petitions are time and again admitted by Reliance. 59. For the sake of completeness, if you see the definition of dispute u/s 5(6), it is not that whatever that is disagreed between the parties will amount to dispute, it will amount to dispute only when it falls within the three categories mentioned u/s 5(6) of the definition that is as follows: 5(6) dispute includes a suit or arbitration proceedings relating to - (a) The existence of the amount of debt; (b) The quality of goods or service; or (c) The brea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reliance. Will anybody become so insane not to terminate services before filing this case? In fact, if any such thing, happened, it is nothing but inviting suicidal effect to Ericsson. Therefore, termination notice is no way connected either to the claim made by Ericsson or any way connected to relate back termination notice as dispute to the claim already admitted by Reliance. 63. The Corporate Debtors counsel has vehemently argued that in the order passed by Arbitral Tribunal mentioned that dispute has been in existence in between Ericsson and Reliance by referring to various paras wherever Arbitral Tribunal has mentioned the word dispute, to understand it, it is essential to visit the order passed by Arbitral Tribunal saying as to whether Arbitral Tribunal anywhere held or said that the claim made by Ericsson is in dispute between Reliance and Ericsson. 64. In para No. 14 of the order of the Arbitral Tribunal, it has been clearly mentioned that refusal to pay admitted debt and challenge to the remnant claim or the claims which would squarely constitute a dispute liable to be referred to arbitration. It has been said that the claims filed by the respondents have not been a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 5(6) of the Code, the next test that is to be applied is to ascertain as to whether such dispute is in existence as mentioned u/s 8(2)(a) of IBC. By reading section 8(2), it has to be seen whether there is a dispute in existence before receipt of section 8 notice or not, here timeline is important, if that cutoff line of the receipt of notice is not there, anybody and everybody will raise a dispute saying that reply has been given saying that dispute is in existence, yes, the corporate debtor is at liberty to say that dispute is in existence but such assertion must relate back to the date before receipt of notice, then only it will become existence of dispute, if that cutoff date has no sense and not considered as mandatory then over a period of time, no operational creditor can raise any claim under section 8 and 9 of this code, indeed these two sections will become redundant. So, now what is the dispute Reliance rising? They say that termination notice has been given therefore, dispute is in existence, can it be considered as dispute under section 5(6) or can it be a dispute in existence u/s 8(2)(a)? However, as I said earlier, it is not at all dispute in relation to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ricsson to these corporate debtors saying that Ericsson would not be in a position to further provide any services to the corporate debtors under the MSA because the corporate debtors continuously failed to pay for the services rendered by Ericsson. 4. Whether the petitions filed under section 9 are complete as envisaged under section 9 of IBC or not? 69. The essential requisite to get the completeness to a petition moved u/s 9 is that a petition u/s 9 is to be filed after expiry of 10 days from the date of delivery of notice and the operational creditor should not have received payment from the corporate debtors or notice of dispute u/s 2 of section 8. These are the two essential requisite to file petition u/s 9 of the code. 70. In the present case, Ericsson gave notice on 07.05.2017, company petitions u/s 9 was filed on 11.09.2017, so the petition has been filed after clear 10 days from the date of delivery of the notice, therefore this condition is fulfilled, as to second condition is concerned, Ericsson has not received payments towards claim amounts from the corporate debtors until before filing of these Company Petitions, of course, till date payment has not been rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ince whatever information required u/s 9 (3) being given and having this Bench noticed that applications made under section 9 are complete, no payments have been made to satisfy the operational debts, notice for payment to the corporate debtors being delivered to the corporate debtors and no notice disputing the claim has been received by the operational creditor as envisaged under Insolvency Bankruptcy Code or even according to the ratio decided by Hon ble Supreme Court in Mobilox, this Bench hereby holds that section 9 petitions in all respects are complete and fit for admission. 71. It is hereby noticed that as to the allegation that Reliance made some payments subsequent to issual of notice u/s 8 of the Code, the Petitioners has clarified in their rejoinder as to how those payments have been adjusted by the Corporate Debtors themselves to the payables arose subsequent to sending notice u/s 8, however, admission of this case is not an order equivalent to decree determining the debt payable by the Corporate Debtors, in this peculiar situation, if for any reason subsequent payments made by Corporate Debtors are not properly accounted, these Corporate Debtors can very much rai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ears is on the managed services provided by Ericsson. On the allegation that one of the Sr. Counsel namely Mr. Joshi made against Ericsson stating that Ericsson fraudulently raised this litigation against Reliance, this Counsel stated as to whether Ericsson has filed a petition that is not permitted under law, has it raised any claim that is denied by the Corporate Debtors, he also questioned, has Reliance ever disputed the due outstanding payable by Corporate Debtors at any point of time. 74. The counsel of Ericsson says that Mr. Joshi, senior counsel on Corporate Debtors behalf ought not to have made an allegation that Ericsson has filed these cases with a fraudulent intention. He says that like all other financial creditors putting their efforts to realise their monies, Ericsson has also put forward its claim under IBC so as to realise its amount, it is not doing anything not permitted under law, it is not doing anything to get unlawful gain from anybody, he says as financial creditor has right to make their claim, Ericsson also trying to realise their claim from Reliance. Whether it comes or not, it is not to be decided by this applicant i.e. SBI, neither these Corporate Deb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay whether the Corporate Debtors have ability to pay or not to pay, it is not mentioned anywhere to examine as to whether the petitioner has malafide intention to proceed against the Corporate Debtors, the only requisite is debt must be there, default must be there, dispute in existence should not be there. If all these three are complied with, this Bench ought to admit these Company Petitions. 77. Therefore, we have not noticed any merit in the application moved by SBI, as to the order of Hon ble Supreme Court, SBI is only given liberty to proceed in accordance with law, not to obstruct the proceeding initiated in accordance with law. Henceforth, the contention of this counsel on behalf of this applicant is bereft of any merit; therefore, this application is hereby dismissed without cost. 78. For having this Bench has noticed that the petitioner proved existence of debt and default, we are of the considered view that these petitions are fit for admission. 79. Accordingly, these Company Petitions are hereby admitted. 80. For there being separate Company Petitions against each of these companies, separate reliefs have been granted which are as follows: CP 1385/2017: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. (ii) That the supply of essential goods or services to the corporate debtor, if continuing, shall not be terminated or suspended or interrupted during moratorium period. (iii) That the provisions of sub-section (1) of Section 14 shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator. (iv) That the order of moratorium shall have effect from 15.05.2018 till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub section (1) of section 31 or passes an order for liquidation of corporate debtor under section 33, as the case may be. (v) That the public announcement of the corporate insolvency resolution process shall be made immediately as specified under section 13 of the Code. (vi) That this Bench will appoint Interim Resolution Professional after having taken confirmation from Resolution Professi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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