Financial Pundits Llp vs Vsr Infratech Pvt.Ltd
- CitationCompany Appeal (AT) (Insolvency) No. 103 of 2019
Ratio decidendi
The rule this decision rests on
Where a corporate debtor has, before the operational creditor's Section 9 application, issued a counter-claim disputing the debt and the operational creditor has replied denying the claimed amount, a pre-existing dispute exists, and an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 is not maintainable on that account. Disputed issues of this kind cannot be decided by the Adjudicating Authority in insolvency proceedings, so the appellant's submission that the Respondent's objections were frivolous or that the dues were admitted does not displace the existence of the pre-existing dispute.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Financial Pundits LLP ...Appellant
Vs.
M/s. VSR Infratech Pvt. Ltd. ...Respondent
Present: For Appellant: - Mrs. Aunish Ahlavat, Ms. Ankita Ahuja and Ms. Palak Rohmetra, Advocates.
ORDER
01.02.2019─ The Appellant filed an application under Section 9 of
the Insolvency and Bankruptcy Code, 2016 ("I&B Code" for short) for
initiation of the 'Corporate Insolvency Resolution Process' against 'M/s.
VSR Infratech Private Limited'; it having dismissed by the order dated 3rd
December, 2018 passed by the Adjudicating Authority (National
Company Law Tribunal), New Delhi Bench-III, the Appellant has
challenged the said order.
2. The Adjudicating Authority has noticed that there is a 'pre-
existence of dispute' with regard to the supply. In fact, the 'Corporate
Debtor' made counter claim on 11th November, 2016 for a sum of Rs.
1,46,06,800/-. The said notice was duly replied by the Appellant vide its
reply dated 23rd November, 2016, denied the amount as was claimed.
Contd/-...........
-2-
3. Learned counsel appearing on behalf of the Appellant submits that
those frivolous objections were raised by the Respondent. In fact, they
have admitted the dues payable to the Appellant. However, such
submission cannot be accepted as disputed issues cannot be decided by
the Adjudicating Authority, counter claim having issued by the
Respondent- 'Corporate Debtor' as back as on 11th November, 2016.
4. There being a pre-existence dispute, the application under Section
9 was not maintainable. In this circumstance, while we condone the delay
in re-filing, dismiss the appeal. No cost.
(Justice S.J. Mukhopadhaya) Chairperson
(Justice Bansi Lal Bhat) Member(Judicial) Ar/uk
Company Appeal (AT) (Insolvency) No. 103 of 2019
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