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TMI Blog2020 (1) TMI 1390X X X X Extracts X X X X X X X X Extracts X X X X ..... whole gamut of the issue this Tribunal finds that existence of the Operational debt is proved and the dispute could not be proved to the satisfaction of this Tribunal by the Corporate Debtor and accordingly the petition for initiating against CIRP Process is admitted - Application admitted - moratorium declared. - CP NO. 636 (IB) OF 2018 - - - Dated:- 31-1-2020 - R. Varadharajan, Judicial Member And Anil Kumar B., Technical Member For the Applicant : B.R. Shankaralingam, Adv. For the Respondent : K.S. Ravichandran, PCS, S. Manjula Devi, M.K. Preetha and Harisha, Advs. ORDER ANIL KUMAR. B., TECHNICAL MEMBER. 1. This Application has been filed invoking the provisions of section 9 of the Insolvency and Bankruptcy Code, 2016 ( I B Code 2016 ) in the format as prescribed under Rule 6 of the Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (hereinafter referred to as AAA Rules ) by the Applicant in the capacity of the Operational Creditor viz., M/s. ADM Agro Industries India Private Limited against the Respondent viz., M/s. Shree Murugan Flour Mills Private Limited. The Applicant seeks to initiate the Corporate Insolvency Resol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perational Creditor sold, supplied and delivered the said Goods to the Corporate Debtor and raised the invoice bearing No. WTTS/58 dated 16-8-2016 for a sum of ₹ 4,24,20,000 (Rupees Four Crore Twenty Four Lakh Twenty Thousand only). In terms of the said Sales Contract and said Invoice the Corporate Debtor was required to make payment within 30 days from the date of receipt of the said goods. 8. It is seen from the application, that during the period of 29th September, 2016 till 27th April, 2017 the Corporate Debtor made payments in several tranches amounting to ₹ 1,96,48,779 (Rupees One Crore Eighty One Lakh Forty Eight Thousand Seven Hundred and Seventy Nine only) but even after several discussions and negotiations with the Corporate Debtor the outstanding debt of ₹ 2,27,71,221 remained outstanding. 9. Pursuant to the enactment of the Insolvency and Bankruptcy Code, 2016, Operational Creditor issued Demand Notice dated 16th August, 2017 under section 8(1) of the said Code to the Corporate Debtor. It is submitted that the said Demand Notice was delivered upon the registered office of the Corporate Debtor on 19th August, 2017. It has been submitted that till ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he date of receipt. (d) The Respondent/Corporate Debtor claims to have intimated to the Applicant vide letter dated 18th August, 2016 as follows: With reference to the above, we have purchased 2100 MT of Wheat from you. The quality of wheat supplied is not good. The sample given and the specifications at the time of concluding transaction was good. But, when wheat was received at our factory, we found that the wheat has lot of impurities, rain damaged, dunky 6 to 7% and 7 to 8% mud balls with stand total comes to 15 kg per quintal. We have incurred heavy loss around ₹ 3000 per MT. So we are sending this letter along with wheat sample through your Representative Mr. Silesh Kalani and we request you to issue compensation for 2100 MT @ ₹ 3,000 per MT . (e) The Respondent has stated that the above letter was handed to the representative of the Applicant, who came and met the Managing Director of the Respondent/Corporate Debtor at his office. The quality issue was communicated to the representative of the Applicant and another letter dated 21st September, 2016 along with the debit note was given to the representative of the Applicant when he visited the factory o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... next date of hearing. It is also directed that both the parties will file a joint memo of compromise outlining the terms and conditions of the settlement of the disputed amount. Put up on 31-8-2018 at 10.30 A.M. (i) The Respondent has stated that they had already paid the settlement amount of ₹ 1,64,71,221 except the disputed amount of ₹ 63 lakhs and that the Counter was being filed for the remaining disputed amount of ₹ 63 lakhs. (j) After the hearing dated 23rd August, 2018, the Applicant and the Respondent/Corporate Debtor have been in correspondence with respect to the disputed amount and with respect to the quality of the wheat supplied. However, it is seen that no consensus could be arrived at between the parties in the matter. (k) Considering the above documents, the statement on affidavit filed by the Applicant the Respondent has stated that there is no dispute is false. It has been alleged that since the date of demand notice, already the issues were in the knowledge of the Operational Creditor and despite the same they had issued the demand notice with a view to threatening the Corporate Debtor by arm twisting the provisions of IBC. It is also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on each and every occasion and it is the Operational Creditor who once again reminded and requested the Corporate Debtor for payment of their outstanding dues but the Corporate Debtor neglected the Operational Creditor and made payment as per their convenience. It was further submitted that the entire debt became due on 15th September, 2016 as per the agreed terms of payment and since then the Operational Creditor has been awaiting payment of their outstanding dues from the Corporate Debtor. (d) It has been submitted by the Operational Creditor that the Corporate Debtor has placed on record only emails wherein partial conversation reflecting their readiness is prepared and moulded as per their convenience but failed to place on record the entire conversation exchanged with the Operational Creditor wherein the Corporate Debtor failed to establish the authenticity of the letters dated l8th August, 2016 and 21st September, 2016 and mode of intimation to the Operational Creditor. The said letters were never received by the Operational Creditor from the Corporate Debtor and the said letters were first time brought into the notice of the Operational Creditor after initiation of procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of both the parties. (i) The Operational Creditor has effected the supply of 2000 MT Mill quality Wheat pursuant to Contract No. WTBTBS/10 @ ₹ 20,200 Per M.T. and the goods were delivered on 16-8-2016 for a total value of ₹ 4,24,20,000. (ii) Payment of ₹ 1,96,48,779 had been effected on 27-4-2017 by the Operational Creditor leaving a balance of ₹ 2,27,71,221. (iii) As no payment was forthcoming to the Operational Creditor a demand notice dated 16-8-2017 was issued which was delivered on 19-8-2017; which remained without having received any reply from the side of the Corporate Debtor as a result of which the Operational Creditor initiated CIRP process for the recovery of ₹ 2,27,71,221 (Rupees Two Crores Twenty Seven Lakhs Seventy One Thousand Two Hundred and Twenty One only). (iv) Counter Affidavit was filed on 4-12-2019 in which it is stated that there is a dispute pertaining to quality issues for an amount of ₹ 4,24,20,000 which is purported to have been communicated on 10-8-2016. 14. During the course of proceedings before this Tribunal, the parties were heard on a series of posting and the parties were given opportunities to fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ₹ 1,64,71,221/- in six equal monthly instalments starting from the month of August, 2018. Corporate Debtor is directed to bring 1st instalment of due amount on next date of hearing and also to file a joint memo of compromise outlining the terms and conditions of the settlement of the disputed amount. 15. This Tribunal observes that the letters of dispute purported to have been issued were produced only during the advanced stage of hearing in the counter affidavit filed by the new Authorized Representative. Further, no record of joint inspection as to the quality issue is seen to have been done by the parties or even by a third party when the quality issue was noticed by the Corporate Debtor; nor the letter of dispute is seen to have been acknowledged by the Operational Creditor. 16. This Tribunal also observes that so far the parties have not filed any Joint Memo of Compromise as directed by this Tribunal nor the Corporate Debtor has been able to produce any further documentary proof to substantiate the existence of dispute which was brought to the notice of this Tribunal only, in the advanced stage of hearing, probably as an afterthought. 17. Taking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20. The duration of the period of moratorium shall be as provided in section 14(4) of the Code and for ready reference reproduced as follows: (4) The order of moratorium shall have effect from the date of such order till the completion of the Corporate Insolvency Resolution Process: Provided that where at any time during the Corporate Insolvency Resolution Process period, if the Adjudicating Authority approves the Resolution Plan under sub-section (1) of section 31 or passes an order for liquidation of Corporate Debtor under section 33, the moratorium shall cease to have effect from the date of such approval or Liquidation Order, as the case may be. 21. The Operational Creditor is directed to pay a sum of ₹ 2,00,000/- (Rupees Two Lakhs Only) to the Interim Resolution Professional upon the Interim Resolution Professional filing the necessary declaration form as required under the provisions of the Code to meet out the expenses to perform the functions assigned to her in accordance to Regulation 6 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 22. Based on the above terms, the Application stands ..... X X X X Extracts X X X X X X X X Extracts X X X X
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