2019 (9) TMI 1488 - Tri - Insolvency and Bankruptcy

Rejection of Resolution plan - contention of learned counsel for Applicant that CIRP started against Corporate Debtor and thus the Applicant filed the claim in Form B before RP on 29-12-2018 along with supporting documents on 11-2-2019 - HELD THAT - When liability is disputed and further documents do not disclose liability then the claim of Applicant cannot be admitted. No error committed by RP in not admitting the claim of Applicant. No grounds to interfere with the order of rejection of claim of Applicant. Application dismissed.

Summary

Issues involved:
- Rejection of claim by the Interim Resolution Professional
- Dispute over services provided by the Applicant
- Lack of documentation establishing a valid contract
- Disagreement on payment of maintenance charges
- Set-off of amount against payment due to another entity
- Disputed liability of the Corporate Debtor

Analysis:
1. The Applicant filed a claim against the Corporate Debtor, which was rejected by the Interim Resolution Professional (IRP). The Applicant provided supporting documents to prove the claim, including emails and notices to proceed, indicating a legal contract for services rendered. However, the IRP rejected the claim citing disputes over services provided, absence of entries in the debtor's books, lack of tax invoices, and absence of a valid contract.

2. The Corporate Debtor countered the claim, alleging negligence and deficiency in services provided by the Applicant. The Debtor claimed to have completed the work with the help of subcontractors and employees of the Applicant due to unsatisfactory services. Payments were made to these parties for their services. The Debtor also highlighted set-off transactions and lack of entries in their books regarding the claimed amount.

3. The Applicant contended that they had provided services as per the contract, and the rejection of the claim was unjust. They argued that the Debtor was liable to pay for services rendered, supported by correspondence and notices to proceed. On the other hand, the IRP and Debtor maintained that no amount was due, pointing to set-off transactions and lack of entries in the books.

4. The Tribunal analyzed the evidence presented by both parties and concluded that the rejection of the claim was justified due to the disputed liability, absence of conclusive documentation, and set-off transactions. The Tribunal dismissed the Applicant's application, upholding the decision of the IRP regarding the rejection of the claim.