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TMI Blog2021 (6) TMI 739X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 9 Application being not maintainable in view of the Arbitration Agreement entered into between the parties, inter alia for following prayers: i. Allow the present Application and refer the parties to Arbitration in the interest of justice. ii. Dispose-off the present section 9, Insolvency Bankruptcy Code, 2016 Application filed by the operational creditor as being not maintainable in view of the arbitration clause present in the Invoices; and 2. It is submitted by the corporate debtor that the Operational Creditor has filed the present Application under Section 9 to initiate Corporate Insolvency Resolution Process under Section 9 of Insolvency and Bankruptcy Code, 2016 and the application is at the initial stage, is pending adjud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation is always retained. It is submitted that the present case is an example where the Operational Creditor has filed a dressed up Application with the intention of avoiding Arbitration for which they themselves have come into an Agreement. 5. It is further submitted by the corporate debtor that the matter of dispute is Arbitrable in nature as held in the matter of 'Booz Allen and Hamilton Inc vs SBI Home Finance Limited & others' where in the Hon'ble Supreme Court has held as follows: The term 'arbitrability' has different meaning in different contexts. The three facets of arbitrability, relating to the jurisdiction of the arbitral tribunal, are as under:- (a) whether the disputes are capable of adjudication and set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le SC touching the issue of arbitrability of the dispute. The legal position was further clarified in the matter of 'Hindustan Petroleum Corporation Limited v Pinkcity Midway Petroleum', the Hon'ble Supreme Court held that where an arbitration clause exists, the court has a mandatory duty to refer dispute arising between the contracting parties to arbitrator. Further, in 'Indus Biotech Private Limited v. Kotak India Venture Fund', NCLT Mumbai Bench, considered the supremacy of Arbitration Act over Insolvency and Bankruptcy Code, 2016 based on the old principle of generalia special bus non derogant i.e. special law prevails over general law, which was discussed in by the Supreme Court in 'Consolidated Engineering Ente ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter, it is an admitted fact that at the end of each invoice issued by the Operational Creditor there is an Arbitration Clause. Against these invoices Corporate Debtor had issued debit note. When the debit notes were issued, the corporate Debtor also received emails from Operational Creditor seeking clarification and contesting the issuance of Debit Note, hence, a dispute had come into existence by admitting the fact that valid invoice was existing between the parties. Subsequently, after the exchange of emails the parties have met multiple times to settle the dispute between them with respect to the invoice amount and supply involved. At this stage we are not going into the merits of existence of per-existing dispute as defined in I & B Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... original arbitration agreement or its duly certified copy before that Court.".
10. With the above discussion we are of the view that, since the disputes are purely contractual in nature, the invocation of arbitration is justified. Once the parties are sent to arbitration, nothing survives in the insolvency application as the issues between the parties after arbitration, will decide the rights of the parties. Hence at this stage, the insolvency application in view of the parties being sent to the arbitration, has become in fructuous.
11. The present application is allowed as prayed, thereby making insolvency application IB 782/ND/2020 as infructuous and hence disposed off, in terms of above order. X X X X Extracts X X X X X X X X Extracts X X X X
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