K & A Organics vs Tamta Construction Co- Pvt. Ltd.

Dr. Deepti Mukesh, J

The Present Application is filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (for brevity ‘code’) read with Rules 6 of the

Insolvency and Bankruptcy (Application to Adjudicating Authority), 2016 (for brevity ‘the Rules’) by K & A Organics (for brevity

‘Applicant’) through Mr. Ankit Mehta, being the partner of the applicant firm, authorized on 04.04.2019, with a prayer to initiate the Corporate

Insolvency process against Tamta Construction Co Pvt. Ltd.(for brevity ‘Corporate Debtor’).

The Applicant is a partnership firm incorporated vide partnership deed dated 25.11.2009 under the provision of Partnership Act, 1932 having its

office at G-40, 3rd Floor, Kirti Nagar, New Delhi-110015, email id: k.aorganics@gmail.com. The applicant is involved in the business of manufacturing

and sale of various industrial chemicals and raw materials.

The Corporate Debtor is a company limited by shares, registered with Registrar of Companies, Delhi, incorporated on 13.09.1990 under the

provisions of Companies Act, 1956 bearing CIN U4520IDL2004PTC130990 with its registered office at T-2, Pankaj Arcade, Plot No. 7, Sectot-11,

Pocketâ€" 4, Dwarka Delhi- 110075 and email Id: Tamtaconstruction@gmail.comThe Authorized Share Capital of the company is Rs.10,00,000/- and

the paid up share capital is Rs 9,90,000/-.

The applicant submits that the corporate debtor approached the applicant for purchase of raw materials and goods in the year 2014. The applicant

submits that they have been supplying chemicals, goods and materials since 2015 as per the specific demands of the corporate debtor, from time to

time in their full satisfaction and also raised invoices between Jan 2015 to Feb 2016 for a total value of approximately Rs.61 Lakh which were duly

acknowledged by the corporate debtor as submitted by the applicant in their demand notice.

The applicant submits that the corporate debtor made payment in part from time to time but belatedly. The last payment was made on 15.12.2017,

which was a part payment towards the total outstanding due, reflected in the ledger of applicant. It is further submitted that the applicant is maintaining

running account of the corporate debtor in its books of accounts.

The applicant issued a demand notice dated 18.03.2019 in Form 3 under Rule 5 of the Insolvency and Bankruptcy (Application to Adjudicating

Authority) Rules, 2016 along with copy of invoices calling upon the corporate debtor to pay the total outstanding amount of Rs. 1,73,106/- and interest

of Rs. 98,670/- @ 24% p.a. aggregating to Rs. 2,71,776/- calculated from the date of default till 15.03.2019.

That vide reply dated 19.04.2019, the corporate debtor denied the contention of the applicant and stated that the applicant in its Section 8 notice had

mentioned that corporate debtor had purchased chemicals and raw materials but has enclosed bills of safety materials. The corporate debtor has

stated that no payment is due to the applicant.

The Applicant filed the present Application under section 9 of IBC, 2016 and served the copy of this application which was duly delivered to the

Corporate Debtor as per service affidavit through speed post.

As per Form V, the total debt outstanding is Rs. 1,73,106/- and interest of Rs. 98,670/- @ 24% p.a. aggregating to Rs. 2,71,776/- calculated from

15.12.2017 till 15.03.2019 date which is due and payable by the corporate debtor to the applicant.

The Corporate Debtor filed reply and submitted the following :

a) The amount claimed is denied and no payment is due and outstanding.

b) Some invoices are wrong and denied and some invoices are repeated. Materials against the some invoices was neither delivered nor received.

c) Further, the corporate debtor submits that payment against all the remaining invoices have been released and is on record.

d) The corporate debtor submits that they have procured safety items from the applicant during the year 2014 to 2015 for an amount of 19,11,681/-and

an amount of Rs. 19,89,412/- has been made. Therefore an excess amount of Rs. 77,731/- has been paid to the applicant which is recoverable and

demanded the same with interest @ 18% p.a.

The applicant filed rejoinder and submitted that the ledger filed by the corporate debtor is false and fabricated and the transactions dated

16.05.2016, 28.06.2016 and 31.03.2017 never happened. Further applicant submits that there are no transactions dated 29.10.2016. However, there is

an entry of similar amount dated 31.03.2016. The applicant also submits that the goods supplied by the applicant were always received by the

corporate debtor in their full satisfaction but is delaying the payment due to its bad financial condition and have filed forged documents to avoid its

legitimate dues.

Considering the documents on records and submissions of counsels, it manifests that the corporate debtor has tried to create and establish a pre-

existing dispute by asserting that the materials were neither delivered nor received. However, no documentary evidence or correspondence is placed

on record by the corporate debtor to support the contentions. No documentary evidence is placed on record to manifest that there is a pre-existing

dispute but the said dispute was raised for the first time only after notice under Section 8 of IBC was issued. In reply only statements are made by

Corporate Debtor which has not been substantiated with any proof.

The corporate debtor has not placed on record any document which exhibits the plausible dispute between the parties. There is no merit in the so-

called dispute raised by the corporate debtor as mere reply filed by the corporate debtor to the present application, is unable to establish any pre-

existing dispute of genuine nature. This leaves no doubt that the default has occurred for the payment of the operational debt for which the invoices

were raised by the applicant and the so called dispute raised by the corporate debtor is merely a moonshine dispute as laid down In “Mobilox

Innovative Private Limited vs. Kirusa Software Private Limitedâ€, the Hon’ble Supreme Court observed that “It is clear , therefore that

once the Operational creditor has filed an application, which is otherwise complete , the adjudicating authority must reject the application

under Section 9(5)(2(d) if notice of dispute has been received by the operational creditor or there is a record of dispute in the information

utility . It is clear that such notice must bring to the notice of operational creditor the “existence†of a dispute or the fact that a suit or

arbitration proceeding relating to a dispute is pending between the parties. Therefore, all that the adjudicating authority is to see at this

stage is whether there is a plausible contention which required further investigation and that the “dispute†is not a patently feeble legal

argument or an assertion of fact unsupported by evidence .It is important to separate the grain from the chaff and to reject a spurious

defence which is mere bluster.†In view of the above observation it can be concluded that the dispute raised by the corporate debtor, is spurious,

plainly frivolous, unable to categorize as genuine dispute as reproduced above and the contention of the corporate debtor, of a pre existing dispute

without any evidence and merit is a clear after thought to defeat the claim of the applicant.

The date of default is 15.12.2017 and the present application is filed on 30.04.2019. Hence the application is not time barred and filed within the

period of limitation.

The registered office of corporate debtor is situated in Delhi and therefore this Tribunal has jurisdiction to entertain and try this application.

The Applicant has filed an affidavit in compliance of section 9(3)(b).

The present application is filed on the Performa prescribed under Rule 6 of the Insolvency and Bankruptcy Code, 2016 of the Insolvency and

Bankruptcy (Application to Adjudicating Authority) Rules, 2016 r/w Section 9 of the code and is complete. The applicant is entitled to claim its dues,

establishing the default in payment of the operational debt. Hence, the application is admitted.

As a consequence of application being admitted and IRP name not suggested by the applicant, this Bench appoints Mr. Pankaj Batra, having email

id pankajbatraip@gmail.com and registration no. IBBI/IPA-003/IP-N00240/2019-20/12752 as the Interim Resolution Professional, subject to the

condition that no disciplinary proceedings are pending against him. The IRP is required to file consent Form-2 of the Insolvency and Bankruptcy Board

of India (Application to Adjudicating Authority) Rule 2016 and make disclosures as required under IBBI (Insolvency Resolution Process for Corporate

Persons) Regulation 2016, within a period of one week from this order.

As a consequence of the application being admitted in terms of Section 9(5) of IBC, 2016, moratorium as envisaged under the provisions of

Section 14(1), shall follow in relation to the corporate debtor, prohibiting as per proviso (a) to (d) of the Code. However, during the pendency of the

moratorium period, terms of Section 14(2) to 14(4) of the Code shall come in force.

We direct the Operational Creditor to deposit a sum of Rs. 2 lacs with the Interim Resolution Professional, namely Mr. Pankaj Batra to meet out

the expenses and perform the functions assigned to him in accordance with regulation 6 of Insolvency and Bankruptcy Board of India (Insolvency

Resolution Process for Corporate Person) Regulations, 2016. The needful shall be done within one week from the date of receipt of this order by the

Operational Creditor. The amount however be subject to adjustment by the Committee of Creditors, as accounted for by Interim Resolution

Professional, and shall be paid back to the Operational Creditor.

A copy of the order shall be communicated to the Applicant and the Corporate Debtor as well as to the IRP above named and intimate of the said

appointment by the Registry. Applicant is also directed to provide a copy of the complete paper book with copy of this order to the IRP. In addition a

copy of said order shall also be forwarded to IBBI for its records and to ROC for updating the Master Data. ROC shall send compliance report to the

Registrar, NCLT.