TMI Blog2021 (2) TMI 788X X X X Extracts X X X X X X X X Extracts X X X X ..... Operational Creditor or not - HELD THAT:- In this matter, the claims pertain to supply of goods and services by third parties and also pertains to the employees dues. Therefore, the same fall within the meaning of the term Operational Debt as defined under the Code. As per the terms of the Business Transfer Agreement, the Respondent was legally under a duty to pay various employees and suppliers of goods and services of which the payment was made by the Petitioner. Therefore, the debt is now transferred and is due and payable to the Petitioner by the Respondent - there remains no doubt that the debt is due and payable and also that the same is admitted by the Respondent itself. It is only now that the Respondent has come with certain defenses and an attempt to show that there is a dispute between the parties. It is observed that this is attempt is nothing but an afterthought and thus, we find no merit in the case of the Respondent. For these reasons, it is a case fit case for admission. Also, the documents submitted by the Petitioner are enough to establish the debt upon the Respondent and hence the defenses made by it cannot be relied. Also, they defaulted in repaying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner had to discharge the said obligation and an amount of ₹ 36,66,696 has been paid by the Respondent. 4. He stated further that as per Clause 7 of the said Agreement, the Respondent agreed that the employees relating to Shade Equipment Business as set out in Annexure 3.1 of the said Agreement will not be automatically transferred to the Respondent either by virtue of the said Agreement or by operation of law. He stated that it was further agreed that the Corporate Debtor shall make an offer for transferring their employment to the Corporate Debtor and in case any such employee opted not to have their service transferred to the Corporate Debtor, the Corporate Debtor will pay their retiral liabilities to the Operational Creditor. He stated that the Respondent is aware that 6 out of 9 employees opted not to have transferred their services to the Respondent and the Petitioner had to pay a total sum of undisputed ₹ 17,29,976/- to them towards their retiral liability. 5. The counsel for the Petitioner stated that accordingly, the Respondent is liable to pay the Operational Creditor, under Clause 5 and 7 of the said Agreement a total sum of ₹ 53,96,672/-. The co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us allegations against the Petitioner and falsely accusing them for breach of contract. To this letter of the Respondent, the Petitioner replied vide an email dated 09.01.2019 denying all the allegations made by the Respondent. 10. The Petitioner has annexed the following documents with the petition: i. Business Transfer Agreement dated 04.11.2016 annexed at Annexure II(b); ii. Letter dated 09.04.2018 annexed at Annexure II(c); iii. Email dated 15.06.2018 along with letter dated 31.05.2017 annexed at Annexure II(e); iv. Respondent s reply dated 29.10.2018 to the Petitioner s Demand Notice annexed at Annexure II(f); v. Respondent s reply dated 10.12.2018 annexed at Annexure II(g); vi. Petitioner s reply dated 09.01.2019 to Respondent s letter dated 10.12.2018 annexed at Annexure II(h); vii. Board Resolution dated 29.11.2018 annexed to Company Petition authorizing Mr. Jim Easow to file the petition is annexed and labelled as Annexure II(i). 11. The Respondent in its reply has denied all the contentions of the Petitioner. In fact, the Respondent has raised objections as to the very maintainability of the petition itself. It has been mentioned that the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Also, the Business Transfer Agreement, its annexures or schedules (which constitute the entire contract between the parties) does not contain any quantification-whether of ₹ 17,29,976/- or otherwise of liability towards employees. Therefore, the claim of this aforesaid amount is not traceable at all to the Agreement between the parties. The same is unsubstantiated and arbitrary. Furthermore, the reliance on Clause 7 of the Business Transfer Agreement is a clear attempt to misguide the Tribunal, because Annexure 1.2 (e) specifically excludes claims by or obligations to employees who do not opt to transfer their services to the Respondent. 15. The respondent in its reply has stated that it has, vide its email dated 15.06.2018 addressed to the Petitioner, denied any and all liabilities. Also, the respondent has denied that it, vide a letter dated 31.05.2017 forwarded via email on 15.06.2018 amounts to an admission of liability. It is only a mala fide attempt on the part of the Petitioner to twist the meaning, import and intent of the letter dated 31.05.2017. It is only a without prejudice offer made by the Respondent to settle the disagreements and differences that had aris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an Operational Debt is owed and includes any person to whom such debt has been legally assigned and/or transferred. The term Operational Debt as defined under Section 5(21) of the Code is as follows: Operational Debt means a claim in respect of the provisions of the goods and services including employment or a debt in respect of the repayment of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority. Here, in this matter, the claims pertain to supply of goods and services by third parties and also pertains to the employees dues. Therefore, the same fall within the meaning of the term Operational Debt as defined under the Code. As per the terms of the Business Transfer Agreement, the Respondent was legally under a duty to pay various employees and suppliers of goods and services of which the payment was made by the Petitioner. Therefore, the debt is now transferred and is due and payable to the Petitioner by the Respondent. Further, this fact is evident from the Respondent s letter dated 17.03.2017 which runs as follows: 2. Assumption of Trade Payables of Italtinto India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority; transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the Corporate Debtor. (e) That the supply of essential goods or services to the Corporate Debtor, if continuing, shall not be terminated or suspended or interrupted during moratorium period. (f) That the provisions of sub-section (1) of Section 14 shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator. (g) That the order of moratorium shall have effect from the date of pronouncement of this order till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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