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TMI Blog2023 (5) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... rate Insolvency Resolution Process ('CIRP' in short) against Corporate Debtor-Kalimata Ispat Industries Private Ltd. (the present Respondent). Aggrieved by this impugned order, the present appeal has been preferred by the Operational Creditor. 2. Giving the factual background, the Learned Counsel for the Appellant submitted that the Operational Creditor sold steel products to the Corporate Debtor. In the course of their business transactions, 129 invoices had been raised by the Appellant of which 46 invoices remained unpaid by the Corporate Debtor. The unpaid invoices aggregated to an amount of Rs.3,01,89,141/- only which included interest @ 18% per annum. This amount being due and payable by the Corporate Debtor, the Appellant had sent a Section 8 demand notice on 28.06.2019. It was submitted that the Respondent sent reply to the notice much beyond the statutory period of 10 days prescribed by the IBC, thus being non-est in the eyes of law. As no further payment was forthcoming from the Respondent, a Section 9 application was filed by the Appellant. 3. It has been further contended by the Learned Counsel for the Appellant that the Corporate Debtor in order to evade payment of ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also been sent asking the Appellant to give a credit note of Rs.2,25,53,061/-, it was contended by the Learned Counsel for the Appellant that these two communications were never delivered to the Appellant nor any material has been brought on record evidencing their delivery. Moreover, as the credit notes were disclosed by the Respondent through a supplementary affidavit before the Adjudicating Authority, the Appellant was denied an opportunity to deal with the same. It was asserted that the Adjudicating Authority by placing reliance on documents which were not on record had committed an error and hence the impugned order suffers from illegality. 7. Making his submissions further, it was stated that the admission of non-payment of Rs.2,20,00,724/- by the Corporate Debtor is in itself a sufficient ground to admit the Section 9 application. It has been contended by the Learned Counsel for the Appellant that the Corporate Debtor had admitted to the existence of 129 invoices aggregating Rs.10,16,11,515/- against which admittedly a payment of only Rs.7,96,10,791/- was made. Thus, a substantial sum beyond the threshold limit still remained due and payable by the Corporate Debtor to the O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able, and if so, whether there has been any default in respect of such payment on the part of the Corporate Debtor and whether the debt has been disputed. This examination would be in consonance with the test laid down by the Hon'ble Supreme Court in Mobilox Innovations Pvt. Ltd. Vs. Kirusa Software Private Limited (2018) 1 SCC 353 (hereinafter referred to as 'Mobilox'). 12. The first set of dispute raised is the issue of credit notes in the context of outstanding dues. It is the case of the Appellant that the Respondent had clearly admitted their liability to pay Rs.2,20,00,724/- in their Account Confirmation Statement of 01.04.2019 as placed at page 253-256 of Appeal Paper Book ('APB' in short). Thus, it is a fit case for admission of Section 9 application. It has also been contended that the Corporate Debtor failed to respond to letter dated 05.06.2019 from Operational Creditor seeking outstanding dues. The Learned Senior Counsel for Respondent denied the receipt of letter dated 05.06.2019 and further submitted that the Account Confirmation Statement was a forged and fabricated document and that the Corporate Debtor had therefore filed a police complaint with Hare Police Statio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of substandard quality on the basis of in-house test report. The second communication dated 03.10.2017, the Corporate Debtor had raised the issue of removal of the rejected goods from their factory premises and their replacement with proper quality goods. In the third communication dated 25.04.2019 notifying termination of the contract by the Corporate Debtor on account of failure on the part of the Operational Creditor to improve the quality of their products, it reiterated removal of rejected materials and reserved the right to claim damages. 16. It is, however, the case of the Appellant that the three communications dated 01.07.2017, 03.10.2017 and 25.04.2019 were false and fabricated and had never been delivered to the Appellant prior to issue of demand notice. The letters were purportedly posted with a manually signed postal receipt from a post office at 'Hide Road'. However, based on information as confirmed by the Department of Posts following an RTI query as placed on record at pages297-299 of the APB, it was asserted that there was no post office nomenclated as 'Hide Road' Post Office. There was a post office named 'Hyde Road' but that was already closed on 28.02.2017. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We agree that the authenticity of the postal stamps on the postage receipts are not the subject matter which can be decided by the Adjudicating Authority or this Tribunal in view of summary jurisdiction having been conferred on them by the IBC. Enquiry into such allegations and counter-allegations would entail detailed investigation and the legislative intent of the IBC does not clothe the Adjudicating Authority with such powers of investigation. We are thus of the considered view that the Adjudicating Authority has not committed any error by restraining itself from entering into any sort of roving enquiry on this issue. 21. At this stage, what we need to find out is whether these three letters had raised a semblance of dispute and if so whether the dispute is patently feeble. The guiding precepts have been laid down in the ratio of Mobilox supra and the relevant para is extracted as hereunder: "51. It is clear, therefore, that once the operational creditor has filed an application, which is otherwise complete, the adjudicating authority must reject the application under Section 9(5)(2)(d) if notice of dispute has been received by the operational creditor or there is a record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the items which has been supplied to us by you and/or your organization viz. BCPL International Ltd. (BCPL) in course of our business dealings were some defective in nature & were of extreme low quality. The said items could not be used by us in our manufacturing activity, as we has a goodwill & reputation in our business sphere, alternatively, if used the said supplied items of BCPL would definitely hampered our said goodwill & reputation. We earlier used very few of your supplied materials in our manufacturing process & for your kind information, the quality of the finished product/s made out of the said materials was of extreme inferior quality which was not fit to be supplied to our customers. Hence, times without number, we severally requested BCPL and /or your office representatives either to replace the aid materials or to take return back the same & issue credit note to us. But, neither of your representatives/officials acted as per our requests & hence ultimately the said delivered items served none of our purpose. The said inferior materials are still lying with us & has become scrap over a period of time. To maintain good relationship, you are again requested to remove/t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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