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TMI Blog2023 (3) TMI 1576X X X X Extracts X X X X X X X X Extracts X X X X ..... ound of litigation, the Appellant was nonsuited by this Tribunal vide its order dated 12.09.2017 on the ground of its locus standi. However, the order dated 12.09.2017 was challenged by the Appellant before the 'Apex Court' in 'Civil Appeal No. 20978 of 2017', which was allowed on 30.04.2019 reported as 2019 (11) SCC 332 and the matter was remanded back to this Tribunal for adjudication. 3. During the course of hearing, it was argued by counsel for the Appellant that there are two issues involved in this appeal for consideration of this Tribunal, namely, as to whether the Application filed under Section 9 of the Code was premature though it has not been filed after the expiry of 10 days from the date of offer of notice issued under Section 8 of the Code? and whether there was a pre-existing dispute on account of which the application was dismissed? 4. Counsel for the Appellant opened his argument to deal with the first issue which goes to the root of the case because if it is found that the application filed by the Appellant under Section 9 of the Code was premature, the other issue regarding as to whether there was a pre-existing dispute or not, need not to be answered. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... locked but ultimately it was delivered on 21.03.2017 at 16:17 hours to Shashi Kant Jha. It is submitted that the notice was actually delivered on 21.03.2017 and the period of 10 days, counted from 21.03.2017 would have expired on 31.03.2017 whereas the petition under Section 9 of the Code was admittedly filed on 28.3.2017, before the expiry of period of 10 days as prescribed under Section 9 of the Code and thus it has rightly been found premature by the Adjudicating Authority. He has further submitted that the decision in the case of C.C. Alavi Haji (supra), is not applicable to the present case because the said decision has been rendered in a matter under Section 138 of the Negotiable Instruments Act, 1881 (the Act of 1881) and also in the said case, notice was not delivered at all and, therefore, presumption was drawn whereas in the present case, the notice was actually delivered on 21.03.2017, therefore, the presumption cannot take the place of proof. He has further submitted that the intention of the legislature has to be gathered from the language used in Section 8 & 9 of the Code in which "delivery of the demand notice" under Section 8 of the Code and "filed the petition aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by sending an attested copy of record that the operational creditor has encashed a cheque issued by the corporate debtor. Explanation.-For the purposes of this section, a "demand notice" means a notice served by an operational creditor to the corporate debtor demanding [payment] of the operational debt in respect of which the default has occurred." Section 9: Application for initiation of corporate insolvency resolution process by operational creditor. 9. (1) After the expiry of the period of ten days from the date of delivery of the notice or invoice demanding payment under subsection (1) of section 8, if the operational creditor does not receive payment from the corporate debtor or notice of the dispute under sub-section (2) of section 8, the operational creditor may file an application before the Adjudicating Authority for initiating a corporate insolvency resolution process. (2) The application under sub-section (1) shall be filed in such form and manner and accompanied with such fee as may be prescribed. (3) The operational creditor shall, along with the application furnish- (a) a copy of the invoice demanding payment or demand notice delivered by the operati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in his application within seven days(i) of the date 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) of this section." 10. It is provided in Section 8 of the Code that the Operational Creditor, on occurrence of a default, may deliver a demand notice of the unpaid operational debt and the Corporate Debtor has to react to the notice within a period of ten days from the receipt by bringing it to the notice of the operational creditor- (a) about existence of a dispute (b) payment of unpaid operational debt. Section 9 of the code provides that the Operational Creditor is eligible to file application under Section 9 only after the expiry of the period of ten days from the date of delivery of the notice prescribed under sub-section (1) of section 8. A careful reading of the aforesaid two provisions, thus, shows that the demand notice of unpaid operational debt is a sine qua non to invoke the provision of Section 9 of the Code. The Corporate Debtor has to react within 10 days from the receipt of demand notice to set up a defence and the applicati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f cheque for insufficiency, etc., of funds in the account. - Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for [a term which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court in C.C. Alavi Haji (supra) which reads as under: "15. ........It is well settled that at the time of taking cognizance of the complaint under Section 138 of the Act, the Court is required to be prima facie satisfied that a case under the said Section is made out and the aforenoted mandatory statutory procedural requirements have been complied with. It is then for the drawer to rebut the presumption about the service of notice and show that he had no knowledge that the notice was brought to his address or that the address mentioned on the cover was incorrect or that the letter was never tendered or that the report of the postman was incorrect. In our opinion, this interpretation of the provision would effectuate the object and purpose for which proviso to Section 138 was enacted, namely, to avoid unnecessary hardship to an honest drawer of a cheque and to provide him an opportunity to make amends." 15. As the matter of fact, the aforesaid quoted case is about presumption of delivery of notice in the absence of actual delivery. Needless to mention that presumption is rebuttal whereas in the summary proceedings like the one in hand, there is no scope for oral evidence to r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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