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TMI Blog2022 (3) TMI 198X X X X Extracts X X X X X X X X Extracts X X X X ..... s and services between the Appellant and the Respondent. The amounts pertaining to 37 invoices have been paid by the Respondent. The same amounts reflect in Part IV of Form 5 of the Application claiming ₹ 4,16,48,466/-and ₹ 7,76,706/-. The delayed payment charges sought to be paid by the Appellant are not supported by any Agreement executed between the parties, based on which the Appellant could have exercised their rights to claim these amounts towards delayed charges. The interest charged towards penalty does not find a mention in any of the 37 invoices which are on record. The Journal Entries not supported by any other additional evidence cannot be solely relied upon to prove that the amount claimed arises out of supply of goods and services to fall within the ambit of the definition of Operational Debt as defined under Section 5(21) of the Code. Further we are inclined to observe that the dishonour of the two cheques is a subject matter of the NI Act, 1881 and recovery of those amounts under the NI Act, 1881 cannot be said to be paid towards the supply of goods and services, specifically in the light of the absence of any such Agreement or invoices to that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices referred to by the Petitioner do not mention any payment terms. Only in 7 invoices an interest at 18% p.a. has been mentioned. Similarly, in none of these 37 invoices, barring one, any proof of payable amount on account of delayed payment has been mentioned. Only one invoice mentions in its terms a delay of 365 days. 30. The Bench takes note that this applicable rate of 2.25% as claimed by the Petitioner has never been a part of any of the invoices and it has been mentioned by the Petitioner only while drawing a summary table without any proof. Therefore, the Bench finds that all these charges like delayed charges, khalapur expenses, travel charges, for which no invoices have been raised are baseless claims, not based on any mutual agreement or any documentary proof. 31. This Bench, therefore, concludes that there is nothing on record which shows that any outstanding Operational Debt as a claim in respect of provision supply of goods or services by way of invoices or any documents has been proved by the Petitioner. In fact, all the 37 invoices which have been put on record by the Petitioner as due from the respondent has been fully paid and are not outstanding. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05/2019 for an amount of ₹ 4 Crores was issued. Again, vide letter dated 30/05/2019, the Respondent confirmed that a payment of ₹ 4,16,18,466/- was payable in favour of the Appellant and another cheque dated 30/06/2019 was issued for this amount. But on 01/07/2019, extension of time was requested by the Respondent till 31/07/2019 and a cheque of ₹ 7,76,706/- was issued towards delayed payment charges and 1.92% penalty interest per month. Subsequent to deposit of the cheques, both the cheques of ₹ 4,16,18,466/- and ₹ 7,76,706/- were dishonoured on the ground of insufficient ones. The Appellant issued a Notice under Section 138 of the Negotiable Instrument Act, 1881 (hereinafter referred to as NI Act ), but there was no response. The Appellant got issued a Section 8 Notice under the Code on 10/01/2020 for a debt amount of ₹ 42,39,172/- as on 31/07/2019 along with delayed payment charges at 1.92% up to 31/12/2019. In response to the Section 8 Notice, the Respondent raise baseless allegations, stating that the letter dated 30/05/2019 and 01/07/2019 were forged. Learned Adjudicating Authority dismissed the Application on the groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndatory requirement, providing the documents to prove the existence of Operational Debt and the amount in default is attached with the Application . The endorsement of the dishonoured cheques mentioned exceeds arrangement but did not relate to forged signatures. This Tribunal in Sudhi Sachdev Vs. APPL Industries Ltd. , Company Appeal (AT) (Insolvency) No. 623 of 2018 has held that pendency of case under Section 138/141 of the NI Act amounts to Admission of debt and not an existence of dispute . There is sufficient evidence on record to prove that the Operational Debt is due in terms of detailed 37 invoices pertaining to high sea-sale, Statement of Debit Notes to the delayed payments, Ledger Accounts of the Respondent showing a Closing Balance of ₹ 4,16,18,466/- along with a signed and stamp Statement of Account as on 30/06/2019 and therefore the Adjudicating Authority has erroneously dismissed the Application filed under Section 9 of the Code on the ground that there was no evidence of any services rendered or amounts due and payable . 3. Submissions of the Learned Counsel appearing on behalf of the Respondent: Learned Counsel for the Respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iting that the same are only supplementary as specifically stated in the letter dated 20th December, 2019 annexed as Exhibit K to the Petition. I say that in the absence of any such proof of transactions, the said claim of the Appellant is merely an extortion based on false and fabricated letters, after forging my signature and thus the present Petition deserved to be dismissed in the limine with costs. I state that in view of the absence of details of the purported transactions including any documents to substantiate such transactions the issue of limitation under law arises. In the absence of relevant dates, amounts and quantity, I am not aware and deny of any/all transactions having taken place in the past three years for which any sums are due and thereby deny the legal validity and locus of this present Petition. On 27/02/2020, the Adjudicating Authority gave one more opportunity to the Appellant, to submit an Affidavit enclosing all the invoices and proof of delivery of the material to the other side corresponding to the amount of debt which is mentioned in their Petition . On 03/03/2020, the Appellant produced 37 invoices and also filed an Additional Affidavit on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount claimed is a Security Deposit and pertains to the Leave and License Agreement. But in their Rejoinder to the Reply dated 08/01/2020, they have denied the same. The Respondent also denies that there was any supply of goods and services between the Appellant and the Respondent. 5. At this juncture, we find it relevant to reproduce Sections 5(20) 5(21) of the Code as hereunder: 5(20) operational creditor means a person to whom an operational debt is owed and includes any person to whom such debt has been legally assigned or transferred; 5(21) operational debt means a claim in respect of the provision of goods or services including employment or a debt in respect of the [payment] of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority; 6. Learned Counsel for the Appellant placed reliance on the Ledger Account and drew our attention to the entry dated 23/01/2018 in which an amount of ₹ 3,26,45,901.32/- was squared off. Further, he also drew our attention to the Ledger Account dated 01/04/2018 to 31/03/2019 wherein the delayed payment charges of ₹ 1,15,19,455/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 7,76,706/-. The delayed payment charges sought to be paid by the Appellant are not supported by any Agreement executed between the parties, based on which the Appellant could have exercised their rights to claim these amounts towards delayed charges. The interest charged towards penalty does not find a mention in any of the 37 invoices which are on record. The Journal Entries not supported by any other additional evidence cannot be solely relied upon to prove that the amount claimed arises out of supply of goods and services to fall within the ambit of the definition of Operational Debt as defined under Section 5(21) of the Code. Further we are inclined to observe that the dishonour of the two cheques is a subject matter of the NI Act, 1881 and recovery of those amounts under the NI Act, 1881 cannot be said to be paid towards the supply of goods and services, specifically in the light of the absence of any such Agreement or invoices to that effect. 8. The Appellant has already initiated steps under Section 138/141 of the NI Act, 1881 and submits that the ratio of Sudhi Sachdev (Supra) is applicable to the facts of this case, as it relates to Admission of debt and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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