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2017 (11) TMI 240 - Tri - Insolvency and BankruptcyCorporate Insolvency Resolution Process - proof of default committed by the Corporate Debtor namely DCM International Ltd. in a sum of ₹ 1.00 crore plus interest at 12% p.a - non refund of security deposit amount given by the Operational Creditor to the Corporate Debtor under lease deed - Held that - Any amount claimed as due by a person representing as Operational Creditor should demonstrate firstly that the said amount in default falls within the definition of claim as defined in section 3(6). Such a claim, secondly should be capable of being treated as a debt as defined under section 3(11) of IBC,2016 and finally the debt should fall within the confines of Section 5(21) of IBC,2016 (i.e.) it should be capable of being treated as an Operational Debt and such an operational debt must be owed by the Corporate Debtor to a creditor who can then be considered as an Operational Creditor as defined under Section 5(20) of IBC,2016. Further, as recently in the matter of Divine Infracon (P.) Ltd. 2017 (11) TMI 194 - NATIONAL COMPANY LAW TRIBUNAL, NEW DELHI has held after a detailed discussion that in relation to transaction of immovable property the same cannot be considered as a transaction falling under the term operation and Operational Debt unless such a transaction having a correlation of direct input to the output produced or supplied by the Corporate Debtor and hence we do not have any hesitation looking at any way in holding that the petitioner will not fall under the definition of Operational Creditor and the claim which is sought to be made can not be considered as an Operational Debt. Further, from the records it is also seen that by sending the notice of dispute dated 3.5.2017 by the Corporate Debtor in relation to the notice of demand dated 31.3.2017 as sent by the Petitioner, a dispute has been projected on the ground that a portion of the properties leased to the Operational Creditor was not given in time by it even after its termination which has occasioned loss of use of the property by the Corporate Debtor giving rise to financial loss to it. As held by the Hon ble Supreme Court of India in Mobilox Innovations Private Limited v. Kirusa Software Private Limited 2017 (9) TMI 1270 - SUPREME COURT OF INDIA it is not necessary that a claim of dispute as raised by the Corporate Debtor will ultimately succeed is not required to be established before this Tribunal in order to bring it within the meaning of dispute. A pre-existence of dispute which has plausible chance of success is sufficient and that the ground of dispute which is taken should not be mere sham or elusive. From the perusal of the notice of dispute dated 3.5.2017 we are satisfied that a plausible dispute has been raised by the Corporate Debtor vis-a-vis the Operational Creditor. Taking all the above into consideration we are not inclined to admit the Petition and the Petition is hence dismissed but without costs.
Issues Involved:
1. Whether the amount claimed by the Operational Creditor qualifies as "Operational Debt" under Section 5(21) of the Insolvency and Bankruptcy Code, 2016 (IBC, 2016). 2. Whether the Petitioner qualifies as an "Operational Creditor" under Section 5(20) of IBC, 2016. 3. Whether there exists a pre-existing dispute between the Operational Creditor and the Corporate Debtor. 4. The relevance and applicability of the Memorandum of Settlement (MoS) in the context of the lease agreements and the IBC, 2016. Issue-wise Detailed Analysis: 1. Qualification of Amount as "Operational Debt": The Tribunal examined whether the claimed amount by the Operational Creditor falls within the definition of "Operational Debt" under Section 5(21) of IBC, 2016. The Operational Creditor argued that the refundable security deposit under the lease agreements should be considered as "Operational Debt" since it pertains to services rendered in the form of leasing immovable property. The Tribunal referred to the judgment in *Satish Mittal v. Ozone Builders & Developers (P.) Ltd.*, which clarified that claims not related to goods, services, employment, or statutory dues do not qualify as "Operational Debt." The Tribunal concluded that the refundable security deposit does not meet the criteria of "Operational Debt" as it is not related to the supply of goods or services. 2. Qualification as "Operational Creditor": The Tribunal analyzed whether the Petitioner could be considered an "Operational Creditor" under Section 5(20) of IBC, 2016. The Operational Creditor relied on the Bankruptcy Law Reforms Committee report, which suggested that lessors could be considered operational creditors. However, the Tribunal clarified that the Corporate Debtor, being the lessor, provided the service of leasing the property, and thus the Operational Creditor, as the lessee, does not fall under the definition of "Operational Creditor." The Tribunal reiterated that for a claim to be considered "Operational Debt," it must arise from the supply of goods or services, which was not the case here. 3. Pre-existing Dispute: The Tribunal considered whether there was a pre-existing dispute between the parties. The Corporate Debtor had raised a dispute regarding the delayed return of the leased property, leading to financial losses. The Tribunal referred to the Supreme Court's decision in *Mobilox Innovations Private Limited v. Kirusa Software Private Limited*, which stated that a plausible dispute suffices to reject a claim under IBC, 2016. The Tribunal found that the Corporate Debtor had raised a legitimate dispute regarding the lease termination and the financial losses incurred, which precluded the initiation of the Corporate Insolvency Resolution Process (CIRP). 4. Relevance and Applicability of the MoS: The Tribunal examined the Memorandum of Settlement (MoS) between the parties, which stipulated the refund of the security deposit in installments. The Corporate Debtor argued that the MoS was not properly stamped and sought to amend the lease provisions. The Tribunal noted that the MoS could not override the statutory definitions and requirements under IBC, 2016. The Tribunal also observed that the MoS did not transform the nature of the claim into an "Operational Debt" as defined under the Code. Conclusion: The Tribunal concluded that the amount claimed by the Operational Creditor does not qualify as "Operational Debt" under Section 5(21) of IBC, 2016, and the Petitioner does not qualify as an "Operational Creditor" under Section 5(20) of IBC, 2016. Additionally, the existence of a pre-existing dispute between the parties further invalidated the claim. Consequently, the Petition was dismissed without costs.
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