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TMI Blog2020 (2) TMI 1127X X X X Extracts X X X X X X X X Extracts X X X X ..... , seeking admission of the petition, initiation of Corporate Insolvency Resolution Process, granting moratorium and appointment of Interim Resolution Professional as prescribed under the Code and Rules thereon. 2. The averments made in the Petition are as follows: 2.1 The petitioner/ operational creditor had entered into a subcontract with the respondent/corporate debtor on 24.12.2010, for construction of the part of six laning of Vadakancherry Thrissur section of NH-47 in the state of Kerala as specified in the scope of agreement to the petitioner/ operational creditor. The contract was to be to be completed within 24 months, viz. by 23.12.2012. Accordingly an order for commencement of work was issued on 24.12.2010. 2.2 In compliance with the scope of agreement, the petitioner/ operational creditor has taken various measures including mobilization of plant and machinery, raw materials, advances paid to landowners for borrowing quarry land, site expenses etc. During the period from January 2011 to June 2012, the petitioner/operational creditor had completed 2.88% of the entire works offloaded on it vide the subcontract in question, the worth of which is Rs. 4,47,29,004/- and rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rational debt of Rs. 4,95,53,552/-within 10 days. The respondent/ corporate debtor has sent interim reply, dated 23.05.2017 through advocate making irrelevant statements. The respondent/ corporate debtor claimed that contract has been extended to 23.12.2012, as per Addendum-I and the claim notice relates to the amount due on 09.01.2016, whereby the claim is barred by limitation. The respondent/ corporate debtor failed to raise dispute in its reply to notice under section 8 as provided under section 5(6) of the IB Code. Section 5(6) reads as under: "Dispute" includes a suit or arbitration proceedings relating to - (a) The existence of the amount of debt; (b) The quality of goods or service; or (c) The breach of a representation or warranty"' The petitioner/operational creditor contends that "dispute in existence" means and includes raising dispute in court of law or Arbitral Tribunal before receipt of notice under section 8 of the Code. However, the respondent/ corporate debtor has neither raised dispute with reference to pending proceedings nor debated on the unpaid operational debt of Rs. 4,95,53,552/- in its interim reply. It is further averred that after issuance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entered into with the petitioner/ operational creditor. The contract value has mutually been finalized at Rs. 1,55,40,57,086/- (One hundred fifty five crores forty lakhs and fifty seven thousand eighty six only). 3.4 The Petitioner/subcontractor entered into an addendum modifying certain clauses in the Subcontract Agreement (pages No. 52 to 57 of the petition). As per the agreement, read with the addendum, it is submitted that there is a well-defined procedure for the subcontractor to complete the work in time, raise the bills after getting certification by the Project Management Consultant (PMC) proving the quality as per the standards and specifications. Messrs Halcrow Consulting India Limited had been appointed by the respondent/ corporate debtor to scrutinise the work done by the petitioner/ operational creditor and to issue Interim Payment Certificate (IPC). A copy of said contract with Messrs Halcrow Consulting India Pvt Ltd is annexed as Document No.3 to the Counter. 3.5 In para 4, page 6 of the counter the respondent/corporate debtor submitted that the lapses, delays and termination of the sub-contract without completion of work had adversely affected the main contract of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt which can conveniently be taken up in the process and execution. (Said letters are at Documents No.7 and 8). 3.9 In para 10, page 10 of the counter the respondent/ corporate debtor relied on Clause 60 of the subcontract agreement (Page 48 of the material papers filed by the petitioner) between the petitioner and the respondent/ corporate debtor, which reads: "The time is of the essence in respect of the subcotractor's obligations under this contract. The subcontractor shall complete all the works as required as per this agreement, to obtain the Completion Certificate or the Provisional Certificate, within a period of 24 (twenty four) months from the date of issue of "Order to commence" i.e. from 24th December 2010." However, the gross value of the work which the petitioner/ operational creditor had completed up to June 2012, as per Interim Payment Certificates, 1 to 11 (IPC-11) was barely Rs. 3,04,58,649 the net value of which is 2, 83,61,968 and this comes to 1.827% of the total value of work given to petitioner/ operational creditor. Whereas, the respondent/ corporate debtor has paid an amount of Rs. 3,23,06,700/- to the petitioner/ operational creditor. 3.10 It is fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 and requested for being relieved from execution of the subcontract and obligations arising out of the same. On insistence of the Director of the respondent/corporate debtor the petitioner/ operational creditor submitted letter, dated 21.01.2013, to the respondent/corporate debtor. It is said in the said letter as under: "We are hereby confirming that as agreed please settle all pending dues of the bills and also the agreed value of transfer assets at the site. We will not claim any idle bills thereafter with regard to this contract." Said letter has been suppressed by the petitioner/operational creditor in its petition. Copy of said letter, dated 21.01.2013, is at DOCUMENT No. 10. 3.16 As regards the bill, IPC-12 (page 95 of the petition), it is submitted in para 16 of the Counter that the petitioner/ operational creditor had surrendered the contract on 21.01.2013 and abandoned the work. Then how bill could be submitted on 12.12.2016, more than three years after abandoning the work. Therefore, bill, IPC-12 for Rs. 1,42,70,536/- is imaginary. 3.17 In para 17 of the Counter it is submitted that bill, IPC-12, dated 09.01.2016, which is the subject matter of the petition was sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent/corporate debtor articulated various payments made by the respondent/ corporate debtor, the time schedule not adhered by the petitioner/ operational creditor and abandonment of work by the petitioner/ operational creditor in its effort to prove that beyond any reasonable doubt the alleged claim has never been admitted by the respondent/ corporate debtor and it was never claimed by the petitioner/ operational creditor in the past. Thus, the Petition is hit by the bar under section 238A of the Insolvency and Bankruptcy Code, 2016. 4. Heard the counsels for petitioner/operational creditor and the respondent/corporate debtor. It is the case of the learned counsel for the petitioner/operational creditor that the petitioner has executed the work in accordance with subcontract entered into with the respondent/corporate debtor, dated 24.12.2010. However, the Corporate Debtor has not paid any amount towards the bill amounting to Rs. 4,95,53,552/- as on 09.02.2016. Of the above amount of Rs. 4,95,53,552/- an amount of Rs. 1,07,78,737/- relates to the payment towards IPC- 12 Bill raised by the Operational Creditor in respect of work done till June, 2012 and due to many impedime ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has returned the performance bank guarantee on 21.01.2013, issued by the State Bank India for an amount of Rs. 4,66,25,000. Copy of the said letter is available at page No. 107 of the counter filed by the corporate debtor. 11. Learned counsel submits that in view of the aforesaid facts indicating surrendering of the contract and raising of bills after 4 years of the said surrendering, the operational creditors claim is clearly barred by time. 12. On going through the contents of the petition, counter filed by the corporate debtor and other documents filed by both the parties and also hearing both the counsels, we are of the opinion that the present petition deserves to be dismissed due to the following reasons: a. It is evident that the operational creditor has surrendered the contract on 21.01.2013 and the same is not denied by it. b. It is also evident that as per the work order, all bills for the work undertaken under subcontract, dated 24.12.2010, by operational creditor are to be raised immediately and to be verified by 3rd party i.e., Project Management Consultant. This is not done in support of the present claim. c. The operational creditor has already taken back th ..... 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