TMI Blog2020 (2) TMI 909X X X X Extracts X X X X X X X X Extracts X X X X ..... ion dismissed. - C.P. (IB) NO. 65/BB/2019 - - - Dated:- 28-8-2019 - Rajeswara Rao Vittanala, Judicial Member And Dr. Ashok Kumar Mishra, Technical Member Vishruth C. Adv., Ms. Anita Patil, Adv., Ms. Uma Arya, Adv. and Ms. B.J. Ragini, Adv. for the Petitioner. S. Vivekananda, Adv. and Theerthesh B.S., Adv. for the Respondent. ORDER Dr. Ashok Kumar Mishra, C.P.(IB) No. 65/BB/2019 is filed by Mr. Arounane. P, U/s. 9 of the IBC, 2016 R/w. Rule 6 of the Insolvency and Bankruptcy (Application to Adjudication Authority) Rules, 2016, by inter alia, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. One Bill Software India Private Limited on the ground that the Corporate Debtor committed a default for total outstanding amount of ₹ 33,79,425/- (Rupees Thirty Three Lakhs Seventy Nine Thousand Four Hundred and Twenty five Only) as on 30.04.2015. 2. Brief facts of the case, as mentioned in the Company Petition, which are relevant to the issue in question, are as follows: (a) M/s. One Bill Software India Private limited (hereinafter referred to as 'Respondent'/'Corporate Debtor') is a Private Limited Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is stated that in the month of February 2015, the Operational Creditor was asked to leave the company with two months notice i.e., 30.04.2015 and on 16.03.2015 the Operational Creditor was assured by Mr. Jayakumar Chelladurai in writing that he would get payment of four instalments as per cash reward letter wherein the first and second instalment would be paid along with full and final settlement and the third and fourth instalments would be paid by January 2016 i.e., the time when the buyer (i.e Enabil) would release final payment to the Corporate Debtor. (h) After relieving the Operational Creditor, he received his full and final settlement from Corporate Debtor but encashment of 1st and 2nd instalments were withheld. When the Operational Creditor approached the Corporate Debtor regarding the same in the month of January 2016, he was told that the buyer (i.e. Enabil) had not paid full amount and hence he would be paid only after the company make sufficient profit. (i) It is submitted that the Operational Creditor wrote to buyer Enabil Solutions on 09.02.2016 and got a confirmation mail that they are not entitled to pay any more dues to the Corporate Debtor. The Operational ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent states that it is pertinent to note that amount claimed in demand notice i.e., Form 3 and in Form 5 reflect different figures. The amount claimed in Form 3 is 59,34,600/-whereas, the amount claimed in Form 5 is ₹ 33,79,452/- (Rupees Thirty Three Lakh seventy nine thousand four hundred and fifty two only). (d) It is submitted that One Bill Software India Private Limited which was formerly known as Tarshan Software Service India Private Limited was founded in the year 2009. The Company presently has 4 directors and 40 employees. One Bill software is mainly into software development and consulting. The Company had two divisions i.e., consulting division and product division. The company was initially formed by Mr. Jayakumar Chelladurai, who is the present Managing Director and Mrs. Barathi Balakrishnan. Subsequently Mr. Arounane Parusuraman, the Petitioner herein was appointed by the Board as Managing Director and was given substantial power to manage the affairs of the Company. The Petitioner held the position as a Managing Director from 2009 to 2015 i.e., till the time he left the company (e) It is stated that during the tenure as a Managing Director, the Board, on 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... July 2016. The Plan B gave an option for upfront payment of cash reward if the employee stays with the company at least till July 2016. (i) It is stated that the Petitioner opted for Plan A and accordingly he was eligible for the amount in four tranches which become due in the month of September 2014, December 2014, June 2015 and December 2015 and the balance after July 2016. The Petitioner left the company on 13.04.2015 after causing severe losses which amounts to crores of rupees. As per clause 5 of the cash reward program the Company forfeited the amount and a Resolution too was passed to this effect. It is further submitted that the Petitioner had responsibility of managing and ensuring the growth in the business in India. The Petitioner did not discharge his responsibility and bring in any business, which impacted the performance of the company. On account of poor performance the Company did not achieve the targets and consequently did not get any Earn-out amount from Enabil. For getting the Earn-out amount the company was required to achieve the following: Revenue for the Earn-out period meets or exceeds US$ 12,100,000/- Revenue for the Earn-out period meets of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into doldrums. 4. Heard the learned Counsel for the Petitioner and the learned Counsel for Respondent. We have carefully perused pleadings along with material papers filed in support of the case and the extant provisions of Code and Law. 5. It is a settled position of law that the provisions of Code cannot be invoked for recovery of outstanding amount but it can be invoked to initiate CIRP for justified reasons as per the Code. The Hon'ble Supreme Court in the case of Mobilox Innovations (P.) Ltd v. Kirusa Software (P.) Ltd. [2017] 144 SCL 37 has inter alia, held that IBC, 2016 is not intended to be substitute to a recovery forum. In another latest judgment rendered in Transmission Corporation of A.P.Ltd. v. Equipment Conductors and Cables Ltd. [2018] 150 SCL 447 (SC). The Hon'ble Supreme Court of India has, inter alia, held that existence of undisputed debt is sine qua non of initiating CIRP. As per para 25 of judgment in Mobilox Innovations Private Limited v. Kirusa Software Private Limited, it is stated that Adjudicating Authority, while examining an application filed under Section 9 of Code, will have to determine: i. Whether there is an 'operational debt&# ..... X X X X Extracts X X X X X X X X Extracts X X X X
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