TMI Blog2019 (7) TMI 1627X X X X Extracts X X X X X X X X Extracts X X X X ..... convinced with the reasons cited by the Petitioner that the case is within limitation. 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 PRIVATE LIMITED VERSUS KIRUSA SOFTWARE PRIVATE LIMITED [ 2017 (9) TMI 1270 - SUPREME COURT] , has inter alia, held that IBC, 2016 is not intended to be substitute to a recovery forum. The alleged debt is also not established as contended by the Petitioner and it is also barred by laches and limitation. Therefore, it is liable to be dismissed. - C.P. (IB) NO. 79/BB/2018 - - - Dated:- 18-7-2019 - Dr. Ashok Kumar Mishra, Technical Member And Rajeswara Rao Vittanala, Judicial Member For the Petitioner : P. Bharath For the Respondent : Vivek B.R. ORDER RAJESWARA RAO VITTANALA, JUDICIAL MEMBER 1. C.P. (IB) No.79/BB/2018 is filed by M/s. KEC International Limited ('Petitioner/Operational Creditor') under Section 9 of the IBC, 2016 read with Rule 6 of the I B (Application to Adjudicating Aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Corporate Debtor would be liable to pay interest at 18% p.a. from the date of invoice till amount due is fully realized, which until this day has not been paid to the Petitioner. (4) It is stated that the Respondent between 28.12.2012 and 16.11.2013 had made part payments of ₹ 33,85,557/- sporadically well outside the time period stipulated to make payments for these invoices. Subsequent to 16.11.2013, the Respondent has failed to make any efforts to make full payments even after repeated reminders from the Operational Creditor through emails and letters dated 10.03.2014, 19.08.2014, 19.11.2014, 19.08.2015, 21.09.2015, 26.10.2015, 27.10.2015 and 12.06.2016. The principal balance amount the Corporate Debtor needed to pay stood at ₹ 28,81,283/- and in addition also incurred an interest of ₹ 40,14,563/- at 18% p.a. from the date of invoice till 06.12.2017, in total the Corporate Debtor is liable to pay ₹ 68,95,846/- as of 06.12.2017. Aggrieved by this conduct of Respondent, the Petitioner even issued notice for winding up under Section 271 of the Companies Act on 15.03.2017 and subsequently, issued statutory demand notice dated 06th December, 2017. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by filing the Statement of Objections dated 13.07.2018, by inter alia contending as follows: (1) It is stated that the instant Petition filed by the Operational Creditor/Applicant is a gross abuse of the IBC, 2016. The Operational Creditor has not come to this Tribunal with clean hands and has filed the instant Petition with the sole motive of arm-twisting the Corporate Debtor into making payments not lawfully due to the Operational Creditor. On this ground alone, the instant Petition deserves to be dismissed with heavy costs. (2) It is stated that the Operational Creditor had only annexed three Invoices (bearing Nos. 77, 51 and 64 produced at pages 22 to 29 of the Petition) to their Demand Notice issued under the Code, however the Operational Creditor in the present Petition is claiming alleged payments due for as many as 6 (Six) Invoices. It is stated that this gross mis-match' between the Demand Notice and the present insolvency Petition are fatal defects and, on this ground, as well, the present Petition deserves to be dismissed. (3) It is further stated that the present Petition is filed in respect of a claim being made by the Operational Creditor for goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate Debtor. 6. Shri Vivek B.R., learned Counsel for the Respondent, on the other hand, while reiterating various averments made in the statement of objections, as briefly stated supra, has further submitted that the claim is barred by laches and limitation and they have also submitted that the transaction in question is basing on the back to back arrangement for payment and the Respondent is merely acting as an intermediary for the transactions made with the Petitioner subject to Commission. 7. It is not in dispute that the cause of action arises against the Purchase Order dated 31.03.2012 and the same is only between the Petitioner and the Respondent and there is no third party involved in this Purchase Order as contended by the Respondent. The Purchase Order has clearly mentioned the payment period as '30 (Thirty) days PDC' So basing on this Purchase Order dated 31.03.2012 bearing No. DESPL/PO/0009/11-12, Revised Purchase Order bearing No. DESPL/PO/0010/11-12 dated 31.03.2012, they have issued invoices (from pages 33 to 46 of the Company Petition). Therefore, as per Purchase Order, there is no reference of interest. The invoices show, as per the Purchase Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll filing of the present case. It is also settled position of law that the provisions of the Code cannot be invoked to recover the alleged outstanding amount and the Adjudicating Authority cannot enter into roving enquiry in summary proceedings initiated under the Code and the law of limitation applies for the provisions of Code. We are not convinced with the reasons cited by the Petitioner that the case is within limitation. 10. 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] 85 taxmann.com 292/144 SCL 37, has inter alia, held that IBC, 2016 is not intended to be substitute to a recovery forum. The Hon'ble Supreme Court in B.K. Educational Services (P.) Ltd. v. Parag Gupta Associates [2018] 98 taxmann.com 213/150 SCL 293 has, inter alia, held that provisions of Limitation Act will apply to proceedings or appeals before NCLT/NCLAT. Section 238A of the Code make provisions of Limitation Act would apply to proceedings unde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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