TMI Blog2020 (12) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... file the instant Petition. The Respondent has addressed a letter dated 14th December, 2017 to the Petitioner by inter alia confirming that they would clear the dues before 5th of January, 2018 with 24% interest Per annum. It is to be stated that the provisions of Code can be invoked to initiate CIRP on justified reasons, and it cannot be invoked with an attempt to recover outstanding amount. The Petitioner has not averred and substantiated that the Corporate Debtor has become insolvent. It is a settled position of law that the provisions of Code cannot be invoked for recovery of outstanding amount. The instant Company Petition is filed with an intention to recover the outstanding amount rather than to initiate CIRP in respect of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Petitioner/Operational Creditor ). (2) M/s. Riteway Packaging Private Limited ( Respondent/ Corporate Debtor ), is a Private Limited Company, was incorporated on 17.04.2012, under the provisions of the Companies Act, 1956, bearing CIN: U21000KA2012PTC063 590. Its Authorized Share Capital of ₹ 20,00,000/- and Paid-up Share Capital of ₹ 20,00,000/-. The Company is engaged in the business of Manufacturing Paper Carton Boxes. (3) The Operational Creditor had provided the service of Duplex Board Reel Materials against several invoices and of which 5 invoices along with 1 Debit Note was due and payable as on the date of sending of Demand Notice. After a long wait to recover the dues, the Operational Creditor had sent a Deman ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. 4. Shri PS Suman, learned Counsel for the Petitioner, while pointing out various averments made in the instant Petition, has further urged the Adjudicating Authority that since debt and default in question are not in dispute, the case may be admitted by initiating CIRP as prayed for. He has relied also upon the following judgements, in support of his case: a) M/s. Arrowline Organic Products Pvt. Ltd. Vs. M/s. Rockwell Industries Pvt. Ltd. I.A./341/2020 in IBA/ 1031/2019 b) Bee Athletic Pvt. Ltd. Vs. DSK Shivajians Football Club Pvt. Ltd. C.P(IB)No.3976 of 2018 c) Om Logistics Ltd. Vs. Servel India Pvt. Ltd. C.P.(IB)No.2728 of 2019 d) Foseco India Limited Vs. Om Boseco Rail Products Limited C.P(IB)No.1735/KB/2019 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st @ 24% p.a. from the due date of respective invoices. The Cheque issued was returned by the Bank due to insufficient funds, vide Memo dated 11.12.2018. However, the Petitioner has not initiated any action for the dishonour of Cheque under provisions of Negotiable Instrument Act till date except the instant Proceedings under the provisions of Code by issuing Statutory Demand Notice dated 27.12.2019, by demanding the Respondent, to pay the unpaid Operational Debt of ₹ 17,91,483/-in full within ten (10) days of receipt of this letter failing which they will initiate CIRP in respect of the Corporate Debtor. However, the instant Petition is filed only on February, 2020. 7. As stated supra, instant Company Petition is filed to recover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be invoked for recovery of outstanding amount. The Hon'ble Supreme Court in the case of Mobilox Innovations Private Limited Vs. Kirusa Software Private Limited, (2018) 1SCC 353 has inter alia, held that IBC, 2016, is not intended to be substitute to a recovery forum. Therefore, mere debt and default cannot be sole basis to initiate CIRP and the Corporate Debtor proved to be insolvent. The Adjudicating Authority should be satisfied that case should be fit initiate CIRP basing on various parameters, which include objects of Cade under the provisions of Code and the law on the issue. The Petitioner has only made out that Debt and default in question are not disputed. However, the Adjudicating Authority could not hear the version of Corp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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