2018 (8) TMI 2045 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - service of demand notice - HELD THAT - The fact that there exists a debt of ₹ 16,95,406.31 owed by the Respondent to the Applicant and the default is amply proved as seen by the documents submitted by the Applicant on pages 79-85 of his petition. The important aspect to be seen here is whether there is a pre-existing dispute raised by the Respondent before receipt of the Section 8 demand notice. The Applicant has amply made it clear both in its application and its rejoinder the feeble attempts made by the Respondent in claiming that it has suffered a loss due to the negligence of the Applicant. The Applicant has also exposed how the Respondent has back dated the notice for conciliation of disputes and tried to escape from the provisions of the Code as is seen from the tracking reports submitted by the Applicant company. The respondent has not come to this Tribunal with clean hands and this attitude is highly condemnable. if the Respondent had good intentions it would have settled the amounts due to the Applicant minus the disputed amount, instead it has adopted devious ways which is not acceptable. Hence the arguments put forth by the Respondent are rejected and this Tribunal orders initiation of the CIRP. The application is admitted - moratorium declared.

Summary

Issues:
Initiation of Corporate Insolvency Resolution Process under Section 9 of Insolvency and Bankruptcy Code, 2016 based on alleged default in settling dues.

Analysis:
1. Alleged Default by Respondent:
- Applicant, engaged in freight forwarding, claims Respondent failed to clear dues of ?18,74,173.22, leading to the application for Corporate Insolvency Resolution Process.
- Notices sent to Respondent via speed post, registered post, and email, with proof of delivery, indicating default by Respondent.

2. Contention of Malafide Conduct by Respondent:
- Applicant alleges Respondent issued letter inviting conciliation proceedings after demand notice, indicating malafide conduct.
- Respondent's actions, including backdating notices and raising frivolous disputes, condemned by Tribunal.

3. Respondent's Defense and Dispute:
- Respondent contends negligence by Applicant caused loss, leading to a genuine dispute, supported by emails and Debit Note.
- Tribunal finds Respondent's dispute attempts frivolous, as Applicant had fulfilled duties per agreement, and Respondent's claims regarding Duty Drawback and VKUY benefits are false.

4. Decision and Order by Tribunal:
- Tribunal finds debt of ?16,95,406.31 owed by Respondent, with clear default proven by Applicant's documents.
- Rejecting Respondent's arguments, Tribunal orders initiation of Corporate Insolvency Resolution Process, condemning Respondent's attempts to escape liability.

5. Appointment of Interim Resolution Professional:
- Applicant proposes interim resolution professional, and moratorium under Section 14(1) of IBC, 2016 comes into effect upon admission of the application.

6. Moratorium Period and Essential Goods/Services:
- Moratorium period specified under Section 14(4) of IBC, 2016, with provisions for essential goods/services not to be terminated during this period.

7. Duration of Moratorium:
- Moratorium remains in effect until completion of corporate insolvency resolution process, ceasing upon approval of resolution plan or liquidation order by Adjudicating Authority.

8. Admission of Application and Communication:
- Application admitted under Section 9(5) of the Code, with orders communicated to Operational Creditor, Corporate Debtor, and forwarded to IBBI for records.