2021 (10) TMI 1076 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - High Seas Sale Agreement - existence of debt and dispute or not - HELD THAT - It is not in dispute that only based upon high sea sale agreements that the corporate debtor has engaged the services of the operational creditor to deliver certain goods from Indonesia to Cochin. However it is seen that after the goods have arrived at Cochin, the corporate debtor was not in a position to take delivery of those goods since the corporate debtor's client, namely, M/s. Mahe Convention and Events Centre, Kannur was constrained to stop the entire projects. However, it is a fact borne on record that based upon the amendment letter which has been issued during the month of October, 2016 the goods which were at the customs house, were ultimately cleared in the name of the new consignee, viz., M/s. Mahe Convention and Events Centre, Kannur and not by the corporate debtor. The operational creditor in their rejoinder has not disputed the said fact that the consignment has been cleared by, viz., M/s. Mahe Convention and Events Centre, Kannur. Hence, this Tribunal is of the view that there is no due which is liable to be paid by the corporate debtor to the operational creditor in the present application and consequently there is no default being committed on the part of the corporate debtor. Application dismissed.

Summary

Issues:
Application under section 9 of the Insolvency and Bankruptcy Code, 2016 for initiating corporate insolvency resolution process against the corporate debtor.

Analysis:
The operational creditor filed an application seeking to initiate the corporate insolvency resolution process against the corporate debtor, citing non-payment of invoices totaling to ?7,49,672. The operational creditor provided logistics services to the corporate debtor, who failed to clear the invoices within the stipulated 30-day period. A demand notice was issued, followed by a reply from the corporate debtor raising disputes. The operational creditor contended that the corporate debtor defaulted in repaying the debt, leading to the insolvency application.

The respondent, corporate debtor, argued that the consignments were cleared by a new consignee, M/s. Mahe Convention and Events Centre, Kannur, not by the corporate debtor. The corporate debtor claimed that the project was halted due to regulatory issues, and the balance confirmation letter admitting the claim was signed by an unauthorized person. The corporate debtor alleged that the operational creditor failed to reconcile the internal documents and filed the application without legal entitlement to the claimed amounts.

Upon reviewing the submissions, the Tribunal found that the consignments were cleared by the new consignee, M/s. Mahe Convention and Events Centre, Kannur, not by the corporate debtor. The Tribunal noted that the operational creditor did not dispute the fact that the consignment was cleared by the third party. Therefore, the Tribunal concluded that there was no due amount owed by the corporate debtor to the operational creditor. Consequently, the Tribunal dismissed the application filed by the operational creditor in I. B. A. No. 914 of 2019, without imposing any costs.