TMI Blog2023 (1) TMI 1147X X X X Extracts X X X X X X X X Extracts X X X X ..... was no deficiency in the Demand Notice with regard to nomenclature of the Corporate Debtor Company. Effective service of the Demand Notice - HELD THAT:- This aspect has also been dwelled upon at length by the Adjudicating Authority and that after taking due cognisance of the address mentioned on the Letter-head of the Settlement Slip issued by the Corporate Debtor to the Operational Creditor it has been correctly held in the Impugned Order that the said slip clearly depicts that the aforesaid address 4th Floor, Plot No.30, STPI Building, Electronic City, Udyog Vihar, Sector 18, Gurgaon-122015 belongs to the Corporate Debtor. The postal tracking report has also been perused by the Adjudicating Authority and thereafter it has been rightly held at Paras 28 and 29 of the Impugned Order that the service having been done on the Gurgaon address, the demand notice has been correctly serviced without defects. In the circumstances, the reasoned findings of the Adjudicating Authority are agreed upon that the Demand Notice was not defective and that it had been both despatched and serviced properly. Existence of pre-existing dispute or not - HELD THAT:- A plain reading of the FIR re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned order the present appeal has been preferred by the suspended Director of the Corporate Debtor. 2. The brief factual matrix of the case is as follows: - The Appellant is the erstwhile Director of the Corporate Debtor /Respondent No.2, namely, M/s LI Digital Payments Private Limited, which is a mobile payment platform for financial transaction services. The Respondent No.1/Operational Creditor was an employee of the Corporate Debtor having been appointed as General Manager, Sales Support vide appointment letter dated 02.08.2018. Services of the Respondent No.1 was terminated/laid off by the Corporate Debtor after issue of a notice of Lay Off on 16.08.2019. A full and final settlement statement slip was issued by the Corporate Debtor in respect of the Operational Debt owed to the Operational Creditor on 21.11.2019. The Operational Creditor not having received the due payment of operational debt owed by the Corporate debtor, sent a Demand Notice on 09.12.2019 seeking settlement of his operational dues of Rs.10,62,977/-. On not having received any reply from the Corporate Debtor to the Demand Notice, the Operational Creditor filed a Section 9 application befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. 5. It has been further submitted that the Operational Creditor has claimed to have issued a Demand Notice on 09.12.2019 demanding a payment of Rs.10,62,977/- but the Demand Notice was never served upon the Corporate Debtor and the tracking report filed by the Operational Creditor is erroneous and incomplete and does not demonstrate service of Demand Notice. As the Demand Notice was not received, the Corporate Debtor was not able to reply to the Section 8 Demand Notice within 10 days for no fault of theirs and this is therefore violative of the principles of natural justice. 6. It has been contended that the Operational Creditor failed to comply with the provisions of Rule 5 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 which provides that the Demand Notice may be delivered at the registered office of the Corporate Debtor. It has been stated that the service of the Demand Notice dated 09.12.2019 at 4th Floor, Plot No.30, STPI Building, Electronic City, Udyog Vihar, Sector 18, Gurgaon-122015 is defective and incomplete as the said office premises was a leased premises and was not in possession of the Corporate Debtor. It has also been c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce on each and every address of the company and therefore the notice was issued in compliance of the provisions of the IBC and Rule 5 of the Insolvency and Bankruptcy Rules, 2016. 9. We have duly considered the detailed arguments and submission advanced by the Learned Counsel for both the parties and perused the records carefully. 10. The pointed issues before us for our consideration is two-fold. Firstly, we need to determine whether the Demand Notice as issued was defective and whether it was ineffectively served. Secondly, we need to see whether the pre-existing dispute existing between the parties arising from FIR No. 499/2019 is supported by evidence. 11. Coming to the first issue, we may begin with the rival contentions surrounding the nomenclature of the Corporate Debtor. It has been contended by the Corporate Debtor that the correct name of the Respondent No. 2 company is LI Digital Payments Pvt. Ltd. but has been wrongly depicted as Lex Innova Digital Payments Pvt. Ltd . The two being different entities and the Demand Notice having been addressed to Lex Innova Digital Payments Pvt. Ltd. , the notice was therefore defective. The rival contention of the Operatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TPI Building, Electronic City, Udyog Vihar, Sector 18, Gurgaon-122015 which was the previous branch office of the Corporate Debtor. The Demand Notice has been claimed to have been allegedly served at an office address which had ceased to be office of the Corporate Debtor since their lease for this building stood terminated and the physical possession of the office was not with the company from 30.09.2019. 15. Moreover, it is the Appellant s contention that the address at which the Operational Creditor had served the Demand Notice was the branch office address and not the registered address of the Corporate Debtor in terms of the Company Master data. The Operational Creditor had thus failed to serve the Demand Notice at the registered office of the Corporate Debtor. It is, therefore, the case of the Appellant that the Operational Creditor failed to serve the Demand Notice at the correct address and also in not having sent the same by email had defaulted in complying with the provisions of the Rule 5(2)(b) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Thus the statutory mandate given for 10 days to reply to the Demand Notice having been deni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en the parties truly exists in fact and that the dispute raised is not spurious, hypothetical or illusory. 19. It has been submitted by the Learned Counsel for the Appellant that the Operational Creditor was informed about the breach committed by him to Clause 6 of the employment agreement. It has also been contended that the impugned order has failed to take cognizance of the fact that the Operational Creditor has been held a conspirator in reference to fraud committed on the Corporate Debtor company along with others as evidenced from FIR No. 499/2019 filed under Sections 409 and 420 IPC which had been registered at the Malad Police Station, Mumbai on 19.11.2019. 20. According to the Learned Counsel for Respondent No.1, the Operational Creditor has denied that he was time and again informed about the alleged breach of Clause 6 of the employment agreement. As regards, his conduct, the Operational Creditor has contended of not having been notified of any fraud or unlawful activity on his part by the Corporate Debtor during his service period. What lends credence to the above contention of the Operational Creditor is that the Corporate Debtor has failed to produce any document ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llows: 30. That the Corporate Debtor has also contended that there is a pre-existing dispute between the parties since the Corporate Debtor had filed an F.I.R No. 499/2019 dated 19.11.2019 at Police Station Malad, Mumbai, registered under Sections 409 and 420 IPC, against the Operational Creditor. However, from perusal of the said FIR annexed at page no. 48 to 86 of the reply, it is nowhere seen that the Applicant is made as an accused. 31. Further from perusal of the records, we observe that the Corporate Debtor, after the date of filing the aforesaid FIR, has sent an email dated 21.11.2019 to the Operational Creditor annexing therewith a statement of full and final settlement of dues of the Applicant/Operational Creditor 32. Evidently, the aforesaid email is an acknowledgement of debt by the Corporate Debtor. Therefore, we are of the considered view that the Corporate Debtor has failed to demonstrate any pre-existing dispute between the parties. 23. A plain reading of the FIR reveals that the Operational Creditor does not appear to figure in the list of the accused. Going by the contents of the said FIR, the inference drawn by the Adjudicating Authority aft ..... X X X X Extracts X X X X X X X X Extracts X X X X
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