2020 (6) TMI 709 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Existence of debt and dispute or not - the corporate debtor says it has disputed the liability to pay the amount sought by the Petitioner - The Corporate Debtor mentions that the Petitioner has failed to place on record any document that provides with the right to receive payment from the Corporate Debtor - the Corporate Debtor mentions that no amount is due and payable and that the subject notice has been issued only to arm twist the Respondent to succumb to the unjustified demand raised. HELD THAT - The total amount which is being claimed by the Operational Creditor is only with respect to demurrage charges. This, the Operational Creditor mentions, is derived from the Bond letter sent by the Corporate Debtor to the Operational Creditor on Judicial Stamp paper - This Bench takes into account the fact that the Corporate Debtor has always cleared it dues/ amount owed to the Petitioner well in time except the disputed claim relating to Demurrage charges which is not enforceable, as the Bond document on the basis of which the Corporate debtor lays its claim on the purported demurrages, is a dead instrument as it never became effective in the absence of any mutually agreed date of implementation. The Bench based on the facts presented before it by both the Parties clearly understands that there is no Agreement between Parties for the Payment of Demurrage charges. Reliance on the Bond document for payment of Demurrage charges is not admissible as it was supposed to come into force from a mutually agreed Effective Date which was never arrived at. Therefore, there is no contractual or mutually agreed enforceable document based on which any demurrages can be claimed by the Petitioner - In the case on hand the contentions raised by the Corporate Debtor regarding nonpayment of demurrage charges are neither spurious nor hypothetical nor illusory and in fact there is a dispute as to existence of the debt payable by the Corporate Debtor. It is established that there is a clear dispute claimed by the Corporate Debtor as provided u/s 5(6)(a) of the Code - Petition dismissed.

Summary

Issues:
1. Application under section 9 of Insolvency & Bankruptcy Code, 2016 for Corporate Insolvency Resolution Process.
2. Claim amount based on Freight Forwarding Agreement.
3. Dispute regarding demurrage charges and outstanding dues.
4. Existence of a contractual agreement for payment.

Analysis:
1. The Application filed by the Operational Creditor sought initiation of Corporate Insolvency Resolution Process against the Corporate Debtor under section 9 of the Insolvency & Bankruptcy Code, 2016.
2. The Operational Creditor, a Private Limited Company, claimed an amount of ?1,76,91,451/- with interest from the Corporate Debtor based on the Freight Forwarding Agreement dated 07.12.2016.
3. The dispute primarily revolved around demurrage charges and outstanding dues. The Operational Creditor alleged that the Corporate Debtor failed to pay for detention charges, leading to disputes over invoiced amounts.
4. The Corporate Debtor contested the claim, arguing that there was no underlying contract or agreement for the claimed amount. They disputed the liability and highlighted discrepancies in the invoices raised by the Operational Creditor.
5. The Tribunal found that the Freight Forwarding Agreement did not mention demurrage charges, and the Corporate Debtor had paid all amounts due as per the agreement. The Bond letter cited by the Operational Creditor was deemed ineffective due to the absence of a mutually agreed effective date.
6. Citing the Supreme Court decision in Mobilox Innovations Pvt. Ltd. v/s Kirusa Software (P) Limited, the Tribunal emphasized that the Insolvency & Bankruptcy Code is not a substitute for a recovery forum and cannot be invoked in the presence of a genuine dispute.
7. Consequently, the Tribunal dismissed the petition, CP 4603(IB)/MB/2018, based on the existence of a clear dispute raised by the Corporate Debtor, as provided under section 5(6)(a) of the Code.