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Home Case Index All Cases Insolvency and Bankruptcy Insolvency and Bankruptcy + AT Insolvency and Bankruptcy - 2022 (10) TMI AT This

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2022 (10) TMI 812 - AT - Insolvency and Bankruptcy


Issues:
1. Dismissal of application under Section 9 of the Insolvency and Bankruptcy Code, 2016 by the Adjudicating Authority.
2. Existence of pre-existing dispute between the parties.
3. Validity of demand notice and arbitration proceedings.

Analysis:

Issue 1: The Appellant filed an appeal against the Adjudicating Authority's order dismissing the application under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Appellant claimed non-payment of operational debt by the Respondent. The Adjudicating Authority observed a pre-existing dispute between the parties before the demand notice was issued, leading to the dismissal of the application.

Issue 2: The Respondent argued a pre-existing dispute with the Appellant since 2016, supported by legal notices and criminal complaints. The Respondent alleged fraud and misrepresentation by the Appellant regarding the supply agreement for SLAZENGER brand products. The Respondent's actions demonstrated a clear pre-existing dispute, as highlighted by legal notices and correspondence.

Issue 3: The Appellant's submissions emphasized the Respondent's admission of liability via email before the demand notice. However, the Respondent contended that the Appellant concealed legal notices and relied on forged documents. The Respondent's refusal to consent to arbitration and the existence of a pre-existing dispute were crucial factors in the dismissal of the application.

Conclusion: The Tribunal, following Supreme Court decisions, concluded that a pre-existing dispute existed between the parties before the demand notice was issued, rendering the application invalid. The Tribunal upheld the Adjudicating Authority's decision, dismissing the appeal. The judgment highlighted the importance of pre-existing disputes in insolvency proceedings, leading to the rejection of the application.

 

 

 

 

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