Agarwal Coal Corporation Private ... vs Sun Paper Mill Limited & Anr

Agarwal Coal Corporation Pvt. Ltd. ...Appellant

Versus

Sun Paper Mill Ltd. & Anr. ...Respondents

Present: For Appellant : Mr. Rajiv Ranjan, Senior Advocate with Ms. Varsha Banerjee, Mr. Milan Singh Negi, Mr. Akshat Singh, Mr. Raza Abbay and Ms. Aliya Durafshan, Advocates

For 1st Respondent: Mr. Ramji Srinivasan, Senior Advocate with Ms. Madhusmita Bora, Ms. Synola Mohapatra and Mr. G. Ashoka Pathy, Advocates

For 2nd Respondent : Mr. Krishnendu Datta and Mr. Vineet Ranjan, Advocates

ORDER

16.10.2019 The Appellant - 'Agarwal Coal Corporation Private Limited'

('Operational Creditor') filed a claim before the 'Interim Resolution

Professional' / 'Resolution Professional'. However, in the 'resolution plan'

submitted by the 'Corporate Debtor', which is a 'Micro, Small & Medium

Enterprises', allowed a sum of Rs. 2173 in favour of the Appellant. The said

'resolution plan' was filed on 16th October, 2018 and approved. This appeal 2

is in subsequent M.A. No. 677/2018 filed later and Interim Order dated 14th

March, 2019 passed by the Adjudicating Authority (National Company Law

Tribunal), Division Bench, Chennai, the Appellant ('Operational Creditor') has

challenged the same.

2. According to the Appellant, the total claim amount as was

Rs, 2,39,33,,935 which was filed before the 'Resolution Professional' related

to the supply of coal from November, 2013 to February, 2014. Learned

counsel for the Appellant submitted that the related invoices and agreements

were also enclosed along with the claim.

3. Further, according to the learned counsel for the Appellant, in view of

the claim amount of Rs. 2,39,33,935 shown in the Form 5 (Application under

Section 9), the 'Corporate Insolvency Resolution Process' was initiated against

the 'Corporate Debtor' at the instance of the Appellant.

4. It is submitted that the claim amount being more than Rupees One

Lakh, the Adjudicating Authority admitted the application under Section 9

and therefore, it is not open to the 'Resolution Professional' or the 'Corporate

Debtor' to suggest that the amount is Rs. 2173.

5. Reliance has been placed on the e-mail dated 2nd November, 2018

issued by the 'Resolution Professional' to the Appellant to suggest that the

aforesaid claim amount was collated and validated by the 'Resolution

Applicant', which reads as under:

Company Appeal (AT) (Insolvency) No. 412 of 2019 3

6. Learned counsel appearing on behalf of the 'Resolution Professional'

submitted that the claim amount collated was Rs 2173 as per report obtained

from one independent 'Chartered Accountant', which was sent with the E-mail

relied on by the Appellant. On validation of the same, the invoices were sent

to the 'Corporate Debtor' / 'Resolution Applicant'. As per the said Report,

the total amount as shown have been paid through RTGS or through other

mode in the account of the 'Corporate Debtor' and only a sum of Rs. 2173 was

found to be payable.

Company Appeal (AT) (Insolvency) No. 412 of 2019 4

7. Same plea has been taken by the learned counsel for the 'Corporate

Debtor' / 'Resolution Applicant'.

8. The Resolution Professional has brought on record a Report of

independent Chartered Accountant dated 1st November, 2018, who on

verification of the ledger of the 'Operational Creditor', invoices and the records

of the 'Corporate Debtor' by letter dated 1st November, 2018 concluded that

both the invoices under consideration are paid giving the balance of Rs. 2173

payable. The copy of the letter dated 1st November, 2018, which reads as

follows:

Company Appeal (AT) (Insolvency) No. 412 of 2019 5

Company Appeal (AT) (Insolvency) No. 412 of 2019 6

9. The Bank statement has also been enclosed with the reply-affidavit filed

by the 'Resolution Professional' in support of the stand taken.

10. The only question arises for consideration is as to how Section 9

application was admitted if the amount is found to be Rs. 2173 which is much

less than Rupees One Lakh.

11. In this regard we may only mention that at the stage of admission of

application under Section 9, the Adjudicating Authority is required to notice

whether the record is complete and there is a 'debt' and 'default' as per

decision of the Hon'ble Supreme Court in 'Innoventive Industries Ltd. v.

ICICI Bank', (2018) 1 SCC 407]. Even if the claim amount is disputed and

is more than Rupees One Lakh, it is to be admitted, the Adjudicating

Authority is not required to go into the details of verification of the claim which

is required to be made by the 'Resolution Professional' and, therefore, even if

some record shows that claim amount is Rupees One Lakh, it is always open

to the 'Resolution Professional' to collate the claim.

Company Appeal (AT) (Insolvency) No. 412 of 2019 7

12. In view of the facts as narrated above, we are not inclined to interfere

with the impugned order dated 14th March, 2019. The appeal is accordingly

dismissed. No costs.

[Justice S.J. Mukhopadhaya] Chairperson

[ Justice A.I.S. Cheema ] Member (Judicial)

[ Kanthi Narahari ] Member (Technical) /ns/gc

Company Appeal (AT) (Insolvency) No. 412 of 2019