TMI Blog2019 (7) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... For The Respondent : Shri Uday Shankar for the Respondent. ORDER Per : RAJESWARA RAO VITTANALA, MEMBER (J) 1. CP(IB) No. 108/BB/2017 is filed by M/s. Posterscope Outdoor Advertising Private Limited ( Applicant/Operational Creditor ) under Section 9 of the IBC, 2016, read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, by inter alia seeking to initiate Corporate Insolvency Resolution Process (CIRP) in respect of M/s. Nitesh Residency Hotels Private Limited ( Respondent/Corporate Debtor ) on the ground that the Corporate Debtor committed a default for a total outstanding amount of ₹ 6,57,500/- (Rupees Six Lakhs Fifty Seven Thousand Five Hundred Only). 2. Brief facts of the case, as mentioned in the Company Petition, are as follows: (1) M/s. Posterscope Outdoor Advertising Private Limited ( Applicant/Operational Creditor ) is a Company incorporated under the provisions of Companies Act and having its registered office at 6th Floor, B-Wing, Poonam Chambers, Dr.Anne Besant Road, Worli, Mumbai-400018. The Company is engaged in the business of providing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the dues owed by them. Applicant made representations to the Advertising Agencies Association of India, Indian Outdoor Advertising Association and the Internet and Mobile Association of India (collectively referred to as the Associations ) reporting to them the Corporate Debtor and its Sister Concerns attempts to renege on their dues owed to Applicant and seeking their intervention in this regard. (5) Considering the above, the Corporate Debtor and its Sister Concerns sought to settle the matter with Applicant and opened negotiations in this regard. After much negotiations, Applicant and the Corporate Debtor and its Sister Concerns executed a Settlement Agreement dated 05.12.2016, whereby the Corporate Debtor and its Sister Concerns would pay Applicant ₹ 65,00,000/- (Rupees Sixty Five Lakhs Only) as full and final settlement of the dues owed by the Corporate Debtor and its Sister Concerns to Applicant and withdraw the winding-up proceedings against Applicant, and Applicant would withdraw the representations made by it to the Associations. Moreover, in the Settlement Agreement, the Corporate Debtor and its Sister Concerns acknowledged and undertook to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... financial strain on account of which, it is merely attempting to renege on its obligation to repay the debt. (9) Thereafter, Applicant issued a statutory notice dated 17.07.2017 to the Corporate Debtor bringing to the above to the Corporate Debtor s notice and calling upon them to pay the debt due to Applicant, failing which, the Applicant would institute insolvency proceedings against the Corporate Debtor. (10) Thereafter on 09.08.2017, the Corporate Debtor sent Applicant a DD dated 09.08.2017 Bearing No.734697 for a sum of ₹ 5,00,000/- (Rupees Five Lakhs Only) towards partial payment of the debt due from the Corporate Debtor to the Applicant. However, apart such partial payment no further payments or communication has been forthcoming from the Corporate Debtor towards the balance debt payable by it to Applicant. 3. The Respondent has filed Objections dated 11.09.2018, by inter alia contending as follows: (1) It is stated that the claim made by the Petitioner is not maintainable under the IBC, 2016 since the claim does not fall within ambit of the definition of Operational Debt vis-a-vis the Petitioner cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the same has arisen out of a Settlement between M/s. Nitesh Estates Ltd. and M/s. Posterscope Outdoor Advertising Pvt. Ltd. and the Respondent Company is not involved in the said Agreement and therefore amount due from a Settlement Agreement cannot be deemed as an Operational Debt. (7) The Respondent is not a signatory to the Settlement Agreement. Neither has the Respondent given any Authorisation to enter into any such Agreement. That such being the fact the allegations against the Respondent are not maintainable and liable to be dismissed. The Settlement in question has not been signed by M/s. Nitesh Residency Hotels Pvt. Ltd. Though it is alleged by the Petitioner that Nitesh Estates Ltd. has signed the Settlement Agreement on behalf of the Respondent, the Respondent has not given any authorization or consent by way of a Board Resolution towards such Settlement. Such being the facts if the claim of the Petitioner is admitted would cause grave injustice to the Respondent. These issues would need to be deliberated before the Trial Court by way of leading evidence etc., and not before the NCLT through this Petition. The Petitioner has failed to provide the nece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a mandatory requirement under Section 9(3)(b). Since a vital requirement of the precondition of admission of Petition nor the IBC has not been followed and on this ground the Petition is liable to be dismissed. (13) It is stated that the Petition filed by the Petitioner is faulty and cannot be proceeded with since the alleged claim amount under notice dated 17.07.2017 varies from the alleged claim amount under the Petition. The claim in the notice shows the amount as ₹ 10,15,000/-, whereas, in the Petition the amount has been shown as ₹ 6,57,500/-. The Petition needs to be dismissed since the amount claimed in the statutory notice and the Petition do not match. (14) It is stated that the claim is made on the basis of settlement entered into by the Petitioner and the Respondent in the winding up Petition filed by the Respondent in CP. No. 95 of 2016 before the Bombay High Court by the Respondent against the Petitioner. That the claim arising out of Settlement Agreement cannot be considered as an Operational Debt. The Petitioner does not fall within the definition of an Operational Creditor and neither does the claim amount being claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te payments of any amounts due and payable as per the Settlement Agreement. When the Settlement Agreement itself has not contemplated payment of interest on delayed payments, the Petitioner cannot seek payment of interest at all. Hence, the Petition itself needs to be dismissed on the ground that the claim amount which includes interest being claimed itself is also in dispute. (19) It is stated that even if considered for argument sake though not payable, the claim under demand notice dated 17.07.2017 is Principal of ₹ 10,00,000/- and interest of ₹ 15,000/- totalling to ₹ 10,15,000/-, whereas the amount alleged in the Petition is Principal amount is ₹ 5,00,000/- and the interest is ₹ 1,57,000/- totalling to ₹ 6,57,500/-. There is a difference of ₹ 1,40,000/- approx in the interest amount just within the span of two months and the same is not at all payable. (20) It is stated that the original claim before the Bombay High Court itself was in dispute. That the winding up Petition was originally initiated by the Respondent herein before the Bombay High Court and that since the claims of the Respondent in that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, C.P No. 266 of 2016 is dismissed as withdrawn by an order dated 15.12.2016 by the Hon ble High Court of Bombay. The order is un-conditional and did not grant any liberty to the parties to raise the issue in question and the above clause is also made clear about it. The demand noticed dated 17.07.2017 issued was also basing on the above settlement Agreement. In fact, the petitioner is estopped from invoking provisions of the Code and it is not meant for recovery and it is summary in nature. It is not in dispute basing on the very Settlement Agreement in question, the Respondent has paid ₹ 5 Lakhs on 24.08.2017 in order to settle the issue. Even the claimed amount is not in accordance with terms of the settlement Agreement as did not talk about the payment of any interest for failure to pay outstanding instalments. The petitioner failed to make out a case that the Respondent is insolvent and the other hand the Respondents has asserted that there are about 500 employees directly/indirectly depending on it. And the Company runs the now Famous Ritz Cariton Hotel on Residency Road, which is an iconic brand in Bengaluru. As stated supra, a winding up petition was filed against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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