TMI Blog2019 (2) TMI 887X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Bankruptcy Code, 2016 (for brevity the Code ) read with rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 with a prayer to trigger the corporate insolvency resolution process in the matter of M/s. Aura Management Services P. Ltd. The operational creditor is a company incorporated under the Companies Act, 1956 and it is based at New Delhi. Its identification number is U74140DL1987PLC030046. 2. Dr. Jatinder Pal Singh Bakshi, director of the operational creditor has been authorized by the board resolution passed in the minutes of the meeting of the board of directors held on April 4, 2018 (page 14) to submit and sign the petition. 3. The corporate debtor -M/s. Aura Management Services P. Ltd., was incorporated on December 18, 2006. Its identification number is U74140DL2006PTC156648. Its authorized share capital is ₹ 1,00,000 and paid-up share capital is ₹ 1,00,000. It is based at 8-C, Hansalaya Building, Barakhamba Road, Delhi-110 001. 4. The case of the operational creditor is that it entered into a memorandum of understanding in the year 2007 with the corporate debtor for provision of facility management services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the operational creditor whereby while deciding issues Nos. 2 and 6 held as under : Issue No. 2 For the above reasons, I award an amount of ₹ 23,55,590 in favour of the claimant and against the respondent. Issue No. 6 Since issue No. 2 has been decided in favour of the claimant, claimant is entitled to interest at 12 per cent. per annum on the amount awarded from the date the amount was due till realization. 9. In light of aforesaid award dated December 2, 2012, the operational creditor initiated Execution Proceeding bearing No. 5685 of 2016 before the Additional District Judge-01, Patiala House Courts, New Delhi. 10. The operational creditor sent demand notice on February 21, 2018 to the corporate debtor as per mandatory provisions of section 8 of the Code on its registered office address at 8-C, Hansalaya Building, Barakhamba Road, Delhi-110 001 but the corporate debtor deliberately and purposely did not receive the said notice. 11. The operational creditor has also attached affidavit vide Diary No. 9506 dated November 29, 2018 as per the requirements of section 9(3)(b) of the Code highlighting that it has not received any payment from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocedure, 1908 in the same manner as if it were a decree of the court. Admittedly the petitioner is not sleeping over the matter and execution proceeding has already been initiated. The amount under the award has become payable once the execution of the award has been initiated well within time and the period for execution of the award/decree is twelve years. Therefore, it cannot be concluded that the amount under the award is not due and payable as on today within the meaning of section 3(12) read with section 7(5)(a) of the Code. We have already recorded our satisfaction that the default has occurred and the amount has become due and payable. Therefore, the question concerning limitation pale into insignificance and the reliance placed on the judgment of hon'ble the Supreme Court in B. K. Educational Services P. Ltd. v. Parag Gupta and Associates [2019] 212 Comp Cas 1 (SC), Civil Appeal No. 23988 of 2017, decided on October 11, 2018 is wholly misplaced. 15. Another argument raised is that the mandatory provisions of section 9(5)(ii)(c) of the Code have not been complied with inasmuch as the invoice and the notice for payment under section 8 of the Code has not been receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 and opined that the operational creditor is entitled to an award of an amount of ₹ 23,55,590 along with interest at 12 per cent. per annum on the awarded amount from the date the amount was due till realization. 17. The definition of the expressions operational creditor and operational debt as given in section 5(20) and (21) of the Code makes it clear that services rendered, inter alia, constitute operational debt . The definition clauses are set out below : 5. (20) 'operational creditor' means a person to whom an operational debt is owed and includes any person to whom such debt has been legally assigned or transferred ; (21) 'operational debt' means a claim in respect of the provision of goods or services including employment or a debt in respect of the repayment of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority. The operational creditor is a person, inter alia, to whom operational debt is owed and includes any person to whom such debt has been assigned or transferred. The definition of the operational creditor is not exhaustive but illustrative. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . He shall file her written communication and all relevant paper immediately before the Registrar of this Tribunal but not later than two days. 20. At this stage we may notice a judgment of the hon'ble Supreme Court rendered in the case of K. Kishan v. Vijay Nirman Co. P. Ltd. [2018] 4 Comp Cas-OL 112 (SC), Civil Appeal Nos. 21824 and 21825 of 2017 decided on August 14, 2018. The principle of law laid down in aforesaid judgment is that if a suit or arbitration proceeding is pending then the amount would be considered to be disputed within the meaning of section 9(5)(ii)(d) of the Code. The judgment in K. Kishan v. Vijay Nirman Co. P. Ltd. [2018] 4 Comp Cas-OL 112 (SC) lays down the proposition of law that in respect of an operational debtor where an arbitral award has been passed against the operational debtor then on corporate insolvency resolution process could be initiated if the award has not been finally adjudicated upon. In that case a petition under section 34 of the Arbitration Act was pending and it was concluded by the hon'ble Supreme Court that no corporate insolvency resolution process could be initiated. In paragraph 19 of the judgment it has been clarified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 002) ; (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. 23. It is made clear that the provisions of moratorium shall not apply to transactions which might be notified by the Central Government. Additionally, the supply of the essential goods or services to the operational debtor as may be specified is not to be terminated or suspended or interrupted during the moratorium period. These would include supply of water, electricity and similar other supplies of goods or services. 24. The interim resolution professional shall perform all his functions religiously and strictly which are contemplated, inter alia, by sections 15, 17, 18, 19, 20 and 21 of the Code. He must follow best practices and principles of fairness which are to apply at various stages of corporate insolvency resolution process. His conduct should be above board and independent ; and he should work with utmost integrity and honesty. It is further made clear that all the personnel connected with the operational debtor, its promoters or any other person associated with the management of the operational debtor are under legal o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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