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2019 (6) TMI 1195 - Tri - Insolvency and BankruptcyInitiation of Corporate Insolvency Resolution Process - Existence of disputes regarding payments - section 9 of the Insolvency and Bankruptcy Code 2016 - It is the contention of the Operational Creditor that they have delivered the goods of the Corporate Debtor to the specified destination as per the instructions and after the delivery it has raised invoices. However the Corporate Debtor failed to rnake the payments - The Corporate Debtor contended that they have cleared all the bills in respect of the Operational Creditor and they have not utilized the services of the Operational Creditor to supply as claimed by them. HELD THAT - It is well settled principle of Law that as long as there exist a real dispute as to payment between the parties and such existence of a dispute is a ground for rejecting the Petition under Section 9 of the 1B Code. In the present case the Adjudicating Authority having satisfied with the submissions put forth by the Corporate Debtor that there is a pre- existing dispute held that the Petition filed under section 9 of the 1B Code is not maintainable and the same is not admitted consequently the Petition is dismissed.
Issues:
1. Company petition under section 9 of the Insolvency and Bankruptcy Code 2016. 2. Dispute regarding outstanding payments for freight charges between Operational Creditor and Corporate Debtor. 3. Verification of supporting documents for transportation of goods. 4. Existence of a real dispute as a ground for rejecting the petition under Section 9 of the I&B Code. Issue 1: Company petition under section 9 of the Insolvency and Bankruptcy Code 2016 The case involved a Company Petition filed by an Operational Creditor against a Corporate Debtor under section 9 of the Insolvency and Bankruptcy Code 2016. The Operational Creditor claimed outstanding payments due and payable for freight charges against invoices raised for goods delivered during the Financial Year 2015-2016. Issue 2: Dispute regarding outstanding payments for freight charges between Operational Creditor and Corporate Debtor The Operational Creditor alleged that the Corporate Debtor failed to pay various invoices raised for freight charges despite timely and qualitative services provided. However, the Corporate Debtor denied the averments, stating that invoices were not cleared due to lack of supporting documents evidencing the transportation of goods. The Corporate Debtor requested specific documents such as Lorry Receipts, Check Post officer stamp, and Customer Acknowledgement, which were not provided by the Operational Creditor. Issue 3: Verification of supporting documents for transportation of goods The Corporate Debtor contended that the Operational Creditor did not submit essential documents proving the transportation of goods, leading to a dispute regarding the invoices raised for transportation services. The Corporate Debtor emphasized the importance of verifying supporting documents like consignee acknowledgments and transit proofs, which were not provided by the Operational Creditor, indicating a lack of evidence to support the claims made. Issue 4: Existence of a real dispute as a ground for rejecting the petition under Section 9 of the I&B Code After hearing both parties and examining the records, the Adjudicating Authority found that a real dispute existed between the Operational Creditor and the Corporate Debtor regarding the outstanding payments for freight charges. The Corporate Debtor raised valid concerns about the lack of essential documents to substantiate the claims made by the Operational Creditor. Citing relevant case laws, the Adjudicating Authority dismissed the petition under section 9 of the I&B Code, emphasizing that the presence of a genuine dispute serves as a ground for rejecting such petitions. This detailed analysis of the legal judgment highlights the key issues involved in the case, focusing on the dispute over outstanding payments for freight charges and the importance of verifying supporting documents in insolvency and bankruptcy proceedings.
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