2022 (5) TMI 804 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditor - existence of debt and dispute or not - HELD THAT - It is clearly shown that the Operational Creditor has adjusted the amount for 15 invoices for the year 2016 however, as per the record only 11 invoices were raised in the year 2016. It is also noted that in the petition the Operational Creditor has alleged that the outstanding amount of a total of 11 invoices (04.01.2017 to 31.10.2017) is pending but in an e-mail dated 21.11.2018 sent by the Operational Creditor to the Corporate Debtor for paying the outstanding amount to the Corporate Debtor, the Operational Creditor has sent the claim of 9 invoices only and the principal amount claimed is Rs. 4,33,086/- but in the petition, the principal claim amount is Rs. 5,01,999/-. - no amount is due to be paid to the Operational Creditor, as the statement of Bank Account of Corporate Debtor, shows that the outstanding amount has been paid. Moreover, there is inconsistency in the details of invoices and adjustment of payments provided by the Operational Creditor. Hence, the present petition is rejected. The present petition is dismissed.

Summary

Issues:
1. Initiation of Corporate Insolvency Resolution Process under Section 9 of the Insolvency and Bankruptcy Code, 2016.
2. Dispute over outstanding payment between Operational Creditor and Corporate Debtor.
3. Validity of Statutory Demand Notice and subsequent actions.
4. Authorization to file petition on behalf of Operational Creditor.
5. Adjustment of payments and invoices discrepancy.
6. Justification of claim amount and payment adjustments.

Analysis:
1. The petition was filed by an Operational Creditor against a Corporate Debtor for defaulting on a payment of Rs. 6,73,726/-, leading to the initiation of the Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016.

2. The Operational Creditor claimed that despite supplying goods and raising invoices, the Corporate Debtor failed to pay Rs. 5,01,999/-. A Statutory Demand Notice was issued, but the Corporate Debtor disputed the claim, stating that the amount had already been paid. The Operational Creditor insisted on CIRP initiation due to non-payment.

3. The Corporate Debtor argued that the petition was misleading, questioning the authority of the person filing it. The Tribunal allowed additional documents to be submitted but found discrepancies in the claim amount and payment details provided by both parties.

4. The Tribunal noted that the Operational Creditor adjusted payments on a first-in, first-out basis, but the number of invoices and adjustments did not match. The Operational Creditor's claim amount also varied in different communications, creating inconsistency.

5. Ultimately, the Tribunal found that the Corporate Debtor had paid the outstanding amount as per bank statements, and the Operational Creditor's claim lacked proper justification and accurate invoice adjustments. Consequently, the petition was rejected, and the matter was dismissed and disposed of by the Tribunal.