TMI Blog2020 (6) TMI 730X X X X Extracts X X X X X X X X Extracts X X X X ..... s 7 of the IBC and the Operational Creditors U/ s 9 of the IBC. So far as the Financial Creditor is concerned, as per Section 7 of the IBC, there is no need to deliver the notice before the initiation of CIRP. Therefore for the initiation of CIRP U/ s 9 of the IBC by the Operational Creditor, the Operational Creditor is required to deliver the demand notice upon the Corporate Debtor U/s 8 of the IBC. The main object of the inception of provision of Section 8 is, This ensures that operational creditors, whose debt claims are usually smaller, are not able to put the corporate debtor into the insolvency resolution process prematurely or initiate the process for extraneous considerations. It may also facilitate informal negotiations betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdance with the provision of Rule 5 of Insolvency and Bankruptcy (Application to Adjudicating Authority) Rule, 2016. The applicant has not complied with the provision contained under Rule 5 of the Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016, therefore, are of the the considered view that the applicant has not delivered the demand notice as required U/ s 8 of the IBC, which is the mandatory provision of law and so on this ground in the absence of delivery of demand notice as required U/ s 8 of IBC - petition filed by the applicant/ operational creditor is not complete and not maintainable and liable to be dismissed. Petition dismissed. - IB No. 495/ND/2020 - - - Dated:- 18-6-2020 - Mr. Abni Ranjan Ku ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eared and remain outstanding. As per the ledger maintained by the Operational Creditor, full payment against 3 invoices remains due and outstanding as on date. These invoices are dated 14.03.2019, 15.03.2019 and 16.08.2019. Part payment against invoice dated 14.03.2019 has been received. The Operational Creditor was further in receipt of cheque dated 07.09.2019 drawn on Kotak Mahindra Bank issued by the Corporate Debtor for ₹ 57,60,728/- which constitutes acknowledgement of liability on part of the Corporate Debtor. This cheque on being presented to the bank for payment was returned dishonoured with the noting payment stopped by drawer . The Operational Creditor has on 09.09.2019 raised a debit note for interest due on delayed paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the registered office by hand, registered post or speed post with acknowledgement due; or (b) by electronic mail service to a whole time director or designated partner or key managerial personnel, if any, of the corporate debtor. (3) A copy of demand notice or invoice demanding payment served under this rule by an operational creditor shaZZ also be filed with an information utility, if any. 7. It is a settled principle of law that there is a difference between the procedure for initiation of CIRP by the Financial Creditors U/ s 7 of the IBC and the Operational Creditors U/ s 9 of the IBC. So far as the Financial Creditor is concerned, as per Section 7 of the IBC, there is no need to deliver the notice before the initiation of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y result in a restructuring of the debt outside the formal proceedings , and that is the reason in Section 8 of the IBC, the word, 'deliver a demand notice of unpaid operational creditor' is mentioned. 9. In the light of aforesaid discussion, when we shall consider the case of the applicant, then We are of the considered view that under Rule 5 of the Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016, there are two modes for sending demand notice, one is, either at the registered office by hand, registered post or speed post with acknowledgement due, or second one, by electronic mail service to a whole time director or designated partner or key managerial personnel, if any, of the corporate debtor, and on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the applicant has not delivered the demand notice as required U/ s 8 of the IBC, which is the mandatory provision of law and so on this ground in the absence of delivery of demand notice as required U/ s 8 of IBC, the present CP No. (IB)3036/ND/2019 filed by the applicant/ operational creditor is not complete and not maintainable and liable to be dismissed. Accordingly, it is therefore, ORDERED The present CP No. (IB) 495/ ND/ 2020 is hereby dismissed, because the applicant has not complied the provision of Section 8 of Insolvency and Bankruptcy Code, 2016 read with rule 5 of Insolvency and Bankruptcy(Application to Adjudicating Authority) Rules, 2016. However, the applicant/ operational creditor is at liberty to file a fresh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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