TMI Blog2019 (8) TMI 1787X X X X Extracts X X X X X X X X Extracts X X X X ..... lution Process (CIRP) in respect of the Corporate Debtor. Further, it is reiterated that this Tribunal is not intended to be substitute to a recovery forum and that the Petitioner ought to act on the recovery certificate issued by the Debt Recovery Tribunal. Furthermore, we do not intend this Tribunal to be a victim forum shopping. The Petition filed under Section 7 of I B Code, 2016 ought to be rejected - petition dismissed. - CP (IB) No. 170/BB/2018 - - - Dated:- 20-8-2019 - Hon ble Rajeswara Rao Vittanala, Member (J) and Hon ble Dr. Ashok Kumar Mishra, Member (T) For the Appellant: Gurudas Kannur, Senior Counsel, Kavitha, and Suja Surendran, Advocates For the Respondent: Bopanna P.C., Rajnath H.V. and S. Rajashekar, Advocates ORDER Dr. Ashok Kumar Mishra, Member (T) 1. The Company Petition bearing CP (IB) No. 170/BB/2018 is filed under Section 7 of Insolvency Bankruptcy Code 2016 read with Rule 4 of I B Code (Application to the Adjudicating Authority) Rules, 2016, by M/s. Reliance Asset Reconstruction Company Limited seeking to initiate CIRP in the matter of M/s. Hotel Poonja International Private Limited. The submissions made in the Company Pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Subsequently, Vijaya Bank filed recovery petition in OA No. 547/1998 before the Debts Recovery Tribunal, Bangalore. Wherein the DRT, Bangalore in OA No. 547/1998 issued a recovery certificate in accordance with compromise memo by virtue of which the Corporate Debtor was directed to pay balance sum of ₹ 75,00,000/- with interest at 12.5% per annum within 9 equal monthly instalments commencing from 30.06.2001. b. Pursuant to compromise entered into the parties, the Respondent could not pay the balance amount and despite the exchange of communication between Vijaya Bank and Respondent, the parties were unable to reach a settlement. Vijaya Bank approached DRT Bangalore and obtained a recovery certificate on 27.03.2003. Subsequent to negotiations, Vijaya Bank issued a letter dated 22.12.2003 calling upon the Respondent to pay the balance amount of ₹ 40 lakhs with interest at 11.5% per annum from 1.10.2003 as per the terms of subsequent understanding. However, the Corporate Debtor did not process the payment. Subsequent to further communication between the parties. Vijaya Bank addressed a letter dated 13.09.2008 calling upon the Corporate Debtor to pay a sum of ₹ 47 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent. Further, the Petitioner approached the Debt Recovery Tribunal in DCP No. 2691/2015 for attachment of the rent payable by Jammu Kashmir Bank, Corporation Bank, Muthhoot Finance, Devika Saries and Dress Materials, Bombay Shop, Nirantara-a Publicity Shop, Unique Systems and Mani CO. The Debt Recovery Tribunal, Karnataka by an order dated 15.03.2017 directed the aforesaid tenants of the Respondent to pay the rent to the Recovery-Officer-1, DRT, Bangalore. The order dated 15.03.2017 came to be challenged by filing WP No. 3520/2018 by Jammu Kashmir Bank before the Hon'ble High Court of Karnataka, wherein the Hon'ble High Court of Karnataka was pleased to grant an interim order of stay to the order dated 14.12.2017. Pursuant to passing of the interim order of stay in WP No. 3520/2018, the tenants are paying the rent to the Respondent. Further, an order passed in O.A. No. 547/1998 came to be challenged by filing WP No. 39858/2018 by one Mr. Vinay Bhat and the said writ petition is pending consideration. g. During 2013, the Petitioner had agreed for settling the dues at ₹ 113 lakhs, that being the case, it is not open for the applicant to contend that the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the Adjudicating Authority is satisfied that: (a) A default has occurred and the application under sub-section (2) is complete, and there is no disciplinary proceedings pending against the proposed resolution professional, it may, by order, admit such application; or (b) Default has not occurred or the application under sub-section (2) is incomplete or any disciplinary proceeding is pending against the proposed resolution professional, it may, by order, reject such application: Provided that the Adjudicating Authority shall, before rejecting the application under clause (b) sub-section (5), give a notice to the applicant to rectify the defect in his application within seven days of receipt of such notice from the Adjudicating Authority. (6) The Corporate Insolvency Resolution Process shall commence from the date of admission of the application under sub-section (5). (7) The Adjudicating Authority shall communicate: (a) the order under clause (a) of sub-section (5) to the financial creditor and the corporate debtor. (b) the order under clause (b) of sub-section (5) to the financial creditor, within seven days of admission or rejection of such application, as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deals with the rent payable vide DRT order in DCP 2691 of 2017 dated 15.03.2017 and the same stands currently adjourned. 7. 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 Vs. Kirusa Software Private Limited 1, has inter alia, held that IBC, 2016 is not intended to be substitute to a recovery forum. In another judgment rendered in Transmission Corporation of A.P. Ltd. Vs. Equipment Conductors and Cables Ltd., 2 Supreme Court of India, it is, inter alia held that existence of undisputed debt is sine qua non of initiating CIRP. 8. Given the disputes between the parties, the orders of the Hon'ble High Court of Karnataka and the Order of the Debt Recovery Tribunal in the aforesaid matter, we do not find 'any justified reasons' to initiate Corporate Insolvency Resolution Process (CIRP) in respect of the Corporate Debtor. Further, we reiterate that this Tribunal is not intended to be substitute to a recovery forum and that the Petitioner ought to ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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