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TMI Blog2017 (6) TMI 1360X X X X Extracts X X X X X X X X Extracts X X X X ..... d question of fact and law and it is triable issue. The dispute raised by respondent company is bona fide dispute on substantial grounds. The intention of the petitioner is obvious that he wants to compel respondent company's management to pay money claimed by him which according to him is due to him. The very fact that the previous management of the respondent company on the date of handing over of the company to the Reliance Defence Engineering Ltd. handed over copy of the ledger for the period 01.04.2015 to 18.01.2016 speaks volumes of the understanding between the petitioner and the previous management of the respondent company. Object of the code is to ensure reorganisation and insolvency resolution of corporate persons, individuals etc. and a time bound manner for maximisation of value of assets, persons, to promote entrepreneurship etc. If this petition is admitted it would negate the object for which Insolvency code was brought into force. The petitioner has got several other remedies to recover the amount due to him, if any, in other forums. But the remedy chosen by this petitioner in this forum is not at all in accordance with the object of the code. The intentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.05.2012 the respondent company was obligated to pay an amount of ₹ 2.00 crores plus applicable service tax. During the period of June, 2012 till February 2015, requisite services were rendered to the company in accordance with the terms and conditions of the contract. On the request of the respondent company, although the BCG assignment was completed in June. 2012, M/s. Capital Partners did not raise any invoice. Ultimately, on 31.03.2015 invoice of ₹ 2,24,72,000/- was sent to the respondent company in respect of fees payable by the respondent company vis- -vis BCG assignment. Invoice was received by the respondent company without any demur or protest. Mr. Sunil Tandon resigned from the company with effect from 01.07.2015 and the same was accepted by the company by its letter dated 15.06.2015. On 25.06.2015, the respondent company terminated the contract on the request of Mr. Sunil Tandon with effect from 30.06.2015. Mr. Sunil Tandon sent reminders to settle accounts of M/s. Capital Partners immediately after his resignation, by way of emails dated 28.05.2015 and 22.06.2015. The respondent company by email dated 29.06.2015 stated that the balance outstanding owed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the respondent. 5. It is the case of the respondent that the claim is based on a stipulation in the letter dated 01.05.2012 whereby an additional fee of ₹ 2.00 crore was agreed to be made upon successful completion of the Boston Consultancy Group assignment. According to the respondent, the same stipulation has not been satisfied and therefore the claim is clearly untenable and therefore the petitioner is not entitled to additional fee of ₹ 2.00 crores as offered by letter dated 01.05.2012. Further, according to the respondent, productivity enhancement was key success factor of the project but the operations, the results recorded and the accounts of the company do not show any such improvement between the period March 2012 till March 2013. The petitioner does not establish successful completion of the Boston Consulting Group assignment. 6. Respondent filed statement of accounts showing that a sum of ₹ 3,54,30,232/- is recoverable from the petitioner since 31.03.2015 with interest @ 12% per annum. It is also stated that the petitioner is illegally withholding and has been misusing the property of the company viz. a Skoda Superb Elegance Car and an air cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent is that the company is a viable unit and has great commercial prospects. The company is a part of the Reliance Anil Dhirubhai Ambani Group and is India's largest shipbuilding and heavy industry company. Reliance group took over the respondent company from Pipavav Defence and Offshore Engineering Limited on 18.01.2016. 10. Authorised share capital of the respondent company is ₹ 1,50,00,00,00,000/-. Paid up share capital of the company is ₹ 7,362,062,690/-. Reserve and surplus of the company is ₹ 7,107,100,000/-. The respondent company is having huge capital reserve. It is unfathomable that it would not be in a position to repay an amount of ₹ 2,26,12,026/- unless there is dispute with regard to said claim. Respondent company has been awarded contract by Indian Navy for construction of five offshore Patrol Vessels with order value of around ₹ 2,975 crores and two contracts by the Indian Coast Guard for construction of cadet training vessel with order value of ₹ 221 crores. There are 2500 employees working directly or indirectly in the respondent company. The respondent company is paying its debts in ordinary course of business. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpletely misconceived and frivolous. 11. Learned counsel appearing for the petitioner referring to the advisory contract dated 30.11.2011 and letter dated 01.05.2012 contended that the advisory contract dated 30.11.2011 was finally amended on 01.05.2012. As per the letter dated 01.05.2012 the respondent company is liable to pay ₹ 13.00 lacs per month plus applicable service tax and ₹ 2.00 crores plus applicable service tax to M/s. Capital Partners. Learned counsel for the petitioner contended that as per mail dated 08.10.2015 an amount of ₹ 2.04 crores are due to the petitioner. Learned counsel for the petitioner pointed out that Mr. Girish Goyal, Sr. Manager Pipavav Defence and Offshore Engineering Company Limited by email dated 29.06.2016 confirmed balance outstanding amount due to the petitioner is ₹ 2,26,12,026/- as on 31.03.2015. Learned counsel for the petitioner also pointed out that as per ledger of the corporate debtor the amount due as on 30.06.2015 is 2,11,51,346/- and as on 30.06.2016 the amount due is ₹ 2,26,33,346/-. Learned counsel for the petitioner further contended that the dispute raised by the respondent company in the reply noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied nature in clause (a)(b) or (c) of sub-section 6 of section 5 of the code. Hon'ble Appellate Tribunal further held that the dispute raised must not be for the sake of dispute and it should be a bona fide dispute. 14. Hon'ble National Company Law Appellate Tribunal while considering what does dispute and existence of dispute means for the purpose of determination of dispute in I B code held as follows:- Though the words 'prima facie' are missing in Sections 8 and 9 of the code, yet the Adjudicating Authority would examine whether notice of dispute in fact raises the dispute and that too within the parameters of two definitions - debt and 'default and then it has to reject the application if it apparently finds that the notice of dispute does really raise a dispute and no other factual ascertainment is required. On the other hand, if the Adjudicating Authority finds that the notice of dispute lacks in particulars or does not raise a dispute, if may admit the application but in either case, there is neither an ascertainment of the dispute, nor satisfaction of the Adjudicating Authority. The definition of dispute is inclusive and not exhaustive. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section (2) of section 8 of the I B code. Without going into the grammar and punctuation being hapless victim of pace of life, if one discovers the true meaning of sub-section (2)(a) of Section 8 of the I B code, having regard to the context of Sections 8 and 9 of the Code, it emerges both from the object and purpose of the I B code and the context in which the expression is used, that disputes raised in the notice sent by the corporate debtor to the Operational Creditor would get covered within sub-section (2) of Section 8 of the I B code. Mere raising a dispute for the same of dispute, unrelated or related to clause (a) or (b) or (c) of Sub-section (6) of Section 5, if not raised prior to application and not pending before any competent court of law or authority cannot be relied upon to hold that there is a dispute raised by the corporate debtor. 15. National Company Law Tribunal, Mumbai bench in CP No. 45 of 2017 in case of M/s. DF Deutsche Forfait AG and Anr. Versus M/s. Uttam Galva Steel Ltd. held that dispute must be pending in a suit or arbitration filed before the receipt of demand notice under section 8. 16. National Company Law Tribunal, Hyderabad Benc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce Offshore Engineering Company Ltd. that too on the request of the previous management of the Respondent Company. Admittedly, Pipavav Defence Offshore Engineering Company Ltd. was taken over by Reliance Defence Engineering Ltd. on 18.01.2016. The invoice dated 31.03.2015 do not reflect in the ledger copy filed by the petitioner which according to him was given to him by the previous management of the respondent company on 18.01.2016. The period covered by the said ledger is from 01.04.2015 to 18.01.2016. The invoices that reflect in the said ledger are dated 02.06.2015 and 30.06.2015. 22. Even, according to the petitioner, there was acknowledgement of debt by the Sr. Manager (A/cs. Finance) by way of email dated 29.06.2015. The first and foremost dispute raised by the respondent is that the purported claim by the petitioner is barred by limitation. It is also the plea of respondent that Mr. Girish Goyal who sent the email acknowledging the debt is not the person authorised to acknowledge the debts. Respondent also disputed the genuineness of the ledger furnished by the previous management of the respondent company to the petitioner on the date of which the company was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Engineering Ltd. on 18.01.2016. Petitioner for the first time raised invoice on 31.03.2015 against Pipavav Defence and Engineering Company Limited after the processes of taking over of Pipavav by reliance group commenced. Petitioner did not choose to initiate any claim against Pipavav Defence and Engineering Company Limited, till it was taken over by Reliance Defence Engineering Ltd. Therefore, the intention of the petitioner is obvious that he wants to compel respondent company's management to pay money claimed by him which according to him is due to him. The very fact that the previous management of the respondent company on the date of handing over of the company to the Reliance Defence Engineering Ltd. handed over copy of the ledger for the period 01.04.2015 to 18.01.2016 speaks volumes of the understanding between the petitioner and the previous management of the respondent company. Object of the code is to ensure reorganisation and insolvency resolution of corporate persons, individuals etc. and a time bound manner for maximisation of value of assets, persons, to promote entrepreneurship etc. If this petition is admitted it would negate the object for which Insolvenc ..... 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