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TMI Blog2019 (9) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... und. It is not the case of the Respondent that there is a pre-existing dispute. The Respondent has not pleaded and nor the Adjudicating Authority held that there is no record of debt or default. In this background, merely on the ground that there is no agreement reached between the parties, it was not open to the Adjudicating Authority to reject application under Section 9 preferred by the Appellant. From the decision of the Hon ble Supreme Court in the case of M/S. INNOVENTIVE INDUSTRIES LTD. VERSUS ICICI BANK ANR. [ 2017 (9) TMI 58 - SUPREME COURT ], it is clear that the Adjudicating Authority is only required to notice as to whether there is a debt and default or not. It was open to the Respondent (Corporate Debtor) to take plea that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t raised any objection or demur as to the work executed by the Operational Creditor in respect of the services provided. The Appellant raised invoices totaling to ₹ 14,54,569/- which were duly accepted and acknowledged by the Corporate Debtor. Further case of Appellant is that pursuant to its claim the Corporate Debtor made part payment of ₹ 2,95,359/- leaving balance amount of ₹ 11,59,230/- along with interest of ₹ 4,27,746/-. Inspite of demand notice made by the Appellant, the Corporate Debtor failed to pay the rest of the amount. 3. The Respondent opposed the prayer on the ground that the claim of the Appellant is frivolous, vexatious and not maintainable either in law or on facts. It is alleged that the applicati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rders placed by the Respondent, on its own huge jump in the SMS quantity which were beyond the capacity of the Respondent was made. On 30th July, 2015, the Appellant sent SMS worth ₹ 1,58,454/-, On 30th September, 2015, the Appellant sent SMS worth ₹ 9,11,856/- and on 31st October, 2015, the Appellant sent SMS worth ₹ 1,08,935/-. Contrarily, the Appellant has raised bill for SMS on 31st December, 2015 though it was beyond the capacity of the Respondent to comply with this huge number of SMS. 6. The Adjudicating Authority on hearing the parties observed as follows:- 7. It is not in dispute there is no contract between the parties except two purchase orders for which due payment released and admittedly only emails being exch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resolution process begins. Default is defined in Section 3(12) in very wide terms as meaning non-payment of a debt once it becomes due and payable, which includes non-payment of even part thereof or an instalment amount. For the meaning of debt , we have to go to Section 3(11), which in turn tells us that a debt means a liability of obligation in respect of a claim and for the meaning of claim , we have to go back to Section 3(6) which defines claim to mean a right to payment even if it is disputed. The Code gets triggered the moment default is of rupees one lakh or more (Section 4). The corporate insolvency resolution process may be triggered by the corporate debtor itself or a financial creditor or operational creditor. A distinction is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licant is to dispatch a copy of the application filed with the adjudicating authority by registered post or speed post to the registered office of the corporate debtor. The speed, within which the adjudicating authority is to ascertain the existence of a default from the records of the information utility or on the basis of evidence furnished by the financial creditor, is important. This it must do within 14 days of the receipt of the application. It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the debt , which may also include a disputed claim, is not due. A debt may not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the information utility or other evidence produced by the financial creditor to satisfy itself that a default has occurred. It is of no matter that the debt is disputed so long as the debt is due i.e. payable unless interdicted by some law or has not yet become due in the sense that it is payable at some future date. It is only when this is proved to the satisfaction of the adjudicating authority that the adjudicating authority may reject an application and not otherwise. 9. From the decision of the Hon ble Supreme Court it is clear that the Adjudicating Authority is only required to notice as to whether there is a debt and default or not. It was open to the Respondent (Corporate Debtor) to take plea that there was no debt payable in law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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