2018 (10) TMI 1727 - Tri - Insolvency and Bankruptcy

Initiation of CIRP - Section 9 of IBC read with Rule-6 of I B (AAA) Rules 2016 - Existence of debt and default - HELD THAT - It is not in dispute there is no contract between the parties except two purchase orders for which due payment released and admittedly only E-mails being exchanged to continue passing on some e-mail correspondence between the parties. It is true that the Tribunal cannot take judicial notice of exchange of E-mail correspondence regarding to disputes in question. It is also to be noted that the learned counsel for the respondent submits that in pursuant they have already paid taken into consideration to the extent that amount is due for the service rendered by the Petitioner. Therefore this passing on the SMS exchange for the services rendered cannot be treated as debt and default. It is not possible for the Tribunal to verify the veracity of the SMS exchanged by the parties. Therefore we are not in a position to accept the debt and default and we are convinced that the amount due to be paid was duly paid.

Summary

Issues:
1. Initiation of Corporate Insolvency Resolution Process (CIRP) under IBC by the petitioner against the respondent.
2. Dispute regarding outstanding payment for Short Messaging Services (SMS) provided by the petitioner to the respondent.
3. Allegations of mala fide intention and lack of bona fides in the company petition.
4. Jurisdiction of the Tribunal based on the absence of a written contract between the parties.
5. Evaluation of evidence and correspondence exchanged between the parties for determining debt and default.

Analysis:

1. The petitioner, a technology company, filed a Company Petition seeking to initiate Corporate Insolvency Resolution Process (CIRP) against the respondent for outstanding dues related to Short Messaging Services (SMS) provided. The respondent, a technology company, opposed the petition alleging false and frivolous claims by the petitioner to coerce them. The respondent disputed the amount claimed and highlighted the absence of a written contract between the parties.

2. The petitioner provided SMS services to the respondent based on purchase orders and subsequent invoices. Despite partial payment by the respondent, a significant outstanding amount remained unpaid. The petitioner issued a legal notice demanding full payment, leading to the initiation of the Company Petition. The respondent contended that the amount claimed was disputed and not entirely valid due to lack of proper communication and instruction for additional services rendered.

3. The respondent argued that the petitioner's claims lacked bona fides and were intended to harass them. The respondent emphasized that the absence of a written contract for promotional SMS services negated the existence of a genuine dispute, citing legal precedents to support their position. The Tribunal considered these arguments in assessing the validity of the petition.

4. The Tribunal deliberated on the jurisdictional aspect concerning the absence of a formal contract between the parties for SMS services. The respondent's counsel asserted that without a written agreement, the Tribunal could not establish jurisdiction solely based on SMS exchanges. The Tribunal also noted the lack of proof regarding the service details and the veracity of the exchanged emails between the parties.

5. After hearing both parties and evaluating the evidence presented, the Tribunal concluded that the absence of a formal contract and the disputed nature of the outstanding amount prevented a clear determination of debt and default. The Tribunal emphasized that without concrete proof and in the absence of a written agreement, it could not verify the validity of the claims made by either party. Consequently, the Company Petition was rejected, and no costs were awarded to either party.