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TMI Blog2019 (9) TMI 1356X X X X Extracts X X X X X X X X Extracts X X X X ..... the year 2013. 3. That, the corporate debtor M/S. Arpita Filaments Private Limited is a company incorporated under the Companies Act, 1956 on 24th March, 2009 and having its registered office at H.K. Street, Begampura, Zampa Bazar, Surat 395 003, having identification No. U17120GJ2009PTC056411. That, authorised share capital of the corporate debtor is Rs. and paid up share capital is Rs. 6,00,000/-. 4. The applicant has submitted that since 2013 it has been regularly supplying various fabrics and the bills raised by the operational creditor were cleared from time to time by the corporate debtor. That, no dispute was ever raised by the corporate debtor with regard to the quality of the products supplied by the operational creditor. 5. The operational creditor has further submitted that on or about August, 2013 the corporate debtor started making irregular payments and the bills were not cleared in time. That, the operational creditor repeatedly pointed out the payment issue to the corporate debtor. That, in the year 2015, to ensure smooth functioning of the business relationship, the corporate debtor provided signed cheques to the operational creditor as security. However, no pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duly served upon the corporate debtor, hence this objection is not sustainable. 10. The second objection raised by the respondent is that Board resolution has not been filed authorising Mr. D.M. Agrawal to show that he had the authority to issue demand notice dated 19.03.2018 as also no authority is seen on record to show that the advocate of the operational creditor had the authority to sign the insolvency petition for and on behalf of the operational creditor. Page No. 8-9 of the additional affidavit filed by the operational creditor is the copy of Board Resolution passed by the Board of Directors of the operational creditor authorising Mr. D.M. Agarwal, accountant of the applicant company to file the petition. Further, with regard to the issue of demand notice issued through advocate is also not sustainable as it is already settled by the Hon 'ble Supreme Court that the Advocate can issue demand notice on behalf of his client i.e. operational creditor. 11. The third objection raised by the corporate debtor is that all the invoices set out in the demand notice dated 19.03.2018 are of the year 2013 and are clearly time barred. 12. During the course of hearing, learned advoc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in question and that the corporate debtor had never handed over to the operational creditor any of those cheques as claimed to have been purportedly handed over in relation to the purported dues of the corporate debtor.......and at the time of losing the same in the month of March 2017, corporate debtor had immediately informed its banker on 04.03.2017". 15. On perusal of the record it is found that page No. 61 to 67 are Xerox copy of the six cheques, all dated 05.12.2017, said to have been handed over to the operational creditor by the corporate debtor as security. On one hand the corporate debtor denies having issued said cheques in favour of the operational creditor and on the other hand corporate debtor has produced copy of the said cheques stating that the very said cheques were lost in the month of March 2017. 16. Further, while going through the details of missing cheques it is found that the respondent has stated cheque Nos. 000372, 000373, 000374, 000376, 000377, 000378 went missing. If it is the case, where is cheque No. 000375?. More so, when the corporate debtor claims that cheques are missing and if the same is true then how the corporate debtor could produce the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and now creating various stories to defend himself. 20. While examining an application under Section 9 of the Act, will have to determine the following: (i) Whether there is an "operational debt" as defined exceeding Rs. 1.00 Iac (See Section 4 of the Act) (ii) Whether the documentary evidence furnished with the application shows that the aforesaid debt is due and payable and has not yet been paid; and (iii) Whether there is existence of a dispute between the parties or the record of the pendency of a suit or arbitration proceeding filed before the receipt of the demand notice of the unpaid operational debt in relation to such dispute? 21. In view of the aforesaid discussions and before rejecting and/or admitting the application, we must refer to the legislation guide on Insolvency Law of United Nations Commission on International Trade Law. One of the things the Legislative Guide spoke about was whether the debt is subject to a legitimate dispute or set off, in an amount equal to or greater than the amount of the debt. 22. Thus, under the facts and circumstances and as discussed above, in the light of the Hon'ble Supreme Court Judgement and the provisions thereof as e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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