In the matter of ATMASTCO Limited

In the matter of: M/s VALIANCE ENGINEERS PRIVATE LIMITED (Through its Director, Mr" Atul Dave), Incorporated under the provisions of the Companies Act, 2013 Having its registered office at 6A16, First Floor, Siri Fort Institutional Area, August Kanti Marg, South Delhi, New Delhi- 110049 Email Id-dave@rraliance. co*. ifr or infor@,yalianae. sq, in Appucewr / OpBnerroNAt CnpprroR Vs. ATMASTCO LIMITED Having its registered office at 157-158, Light Industrial Area, Nandini Road, Opposite Karunna Hospitai, Durg, Bhilai, Chattisgarh-49OO26 E m a i I I d - a tm p-1@ atm-a s-t-c o .c o m o r Agn-a S"tq q.g f Up@,gtgai l.g9!A _o. Rpsporpprt/ ConroRATE Dpsron Darp or Pnorouucpmplrz 29.o,8,2o.25

Conana: Dppp Cnaupne Josur (Meunon Juorcnl) BervweRr Lel Il,Ippwa (MouauR TEcHNTcALI

Appplneucp: Fon Appt IcANT: MR. StpnARTH Knatren, Aovocere Mn. Axesn Jeru, Apvocerp Mn. Dryt.l Auulnv, Apvocerp Fon RuSpoNDENT: Mn Y Vr;eY, Apvocarp Mn. Aplsu GrRr 5,1

NCLT, Cuttack Bench CP(IB) No"52lCB/2024 ORDER Ppn: DpBp Cuawona Josnr. M(Jl 1" The present Application has been filed on 19.02.2024 by Valiance Engineers Private Limited (hereinafter referred as K Applicant/Operational CreditorlOC") seeking to initiate Corporate Insolvency Resolution Process (hereinafter referred to as "cIRp") against Atmastco Limited (hereinafter called ,the Respondent/corporate Debtor/cD") by invoking the provisions of section 9 of the Insolvency and Bankruptcy code,2016 (hereinafter called "code/IBC") read with Rule 6 of Insolvency & Bankruptcy (Application to adjudicating Authority) Rules, 2016 for an operational Debt of Rs. 1,82,o8,9651- (Rupees one crores Eighty Two Lakhs Eight Thousand Nine Hundred and Sixty-Five) and the Date of Default as stated in Part-lV of the application ts 22.12.2023 Bmpp SumnaeRy or.tHp plpeprtvcs: 2. The averments made by the Applicant in its application are summarized herein: 2"L Tata Steel had awarded to Respondent a contract for 2L9.86 crores for execution of Epc work of silico Manganese Plant at Ferroy Allow Plant, Joda, Orissa. 2"2 Respondent desired to engage a sub-contractor for Supply, Manufacturing, Deliver to Site, Erection of 'lechnological Equipment & structure of Balance of plant (Bop) excluding the submerged are of furnace for 2x1g.s MVA High carbon Silico Manganese 0.06 MTPA capacity plant for Tata Steel Limited, Ferro Alloy Plant, Joda (hereinafter referred to as 'Project') and foe which both the parties entered a contract dated O1.O9.2023. 2.3 Respondent illegally terminated the contract datecl o1"o9.2023 vide their Email dated 23.tt.2022. After termination of the contract, Applicant had raised an invoice dated 30.11 .2023 of Rs" 4,76,60,4691- for the works done prior to termination of the contract and as per the terms of the 3a Sd t \-+-

NCLT, Cuttack Bench CP(IB) No.52lCBl2024 contract, all payment had to be made within 21 days of the date of submissions of Invoices and hence the invoice wa.s due and payable on 21.12"2023" The Tax invoice issued by the cD stated that in case of default in payment an interest will @rB% be payable by the respondent. 2"4 The invoice dated 30.11 .202A was acknowledged by the cD vide email dated 06.12.2023 and sought time to reconcile accounts on their end before making payment. The Applicant neither received any payment from the cD nor the cD raised any dispute in respect to the invoice raised by the applicant, hence the applicant sent a demand notice dated os.o3"2o24 under Section B of IBC. 2.5 Pursuant to the Demand Notice dated OS.O}.2O24, corporate Debtor and operational creditor had reconciled their accounts and had arrived at an amount of Rs. 4,O2,65,L391- to be due from corporate Debtor to operational creditor in terms of the contract dated 01.o9,2028 and,lnvoice dated 30" 1 1 .2o2s" The said fact was duly agreed upon in settlement Agreement dated 09 .O4.2024 ^ 2.6 After entering into the settlement agreement, the Corporate Debtor had paid an amount of Rs. 1,00,00,00O1- on 12.O4.2024 and a further sum of Rs. 25,00 l-on 1g.05.2024 ,OOO but did not clear the whole amount, hence a second Demand Notice dated 27 .o5"2024 under Section 8 of IBC was sent by the applicant demanding a sum of Rs. 2,84,6s,34s1- consisting of principal amount of Rs. 2,77,6s,1s91- and interest of Rs. 7,OO,2O9/- as on 26.05.2024. 2"7 Pursuant to receipt of the Second Demand Notice dated 27.o5.2o24 under Section 8 of IBC, the corporate Debtor vide its email dated 06.06.2024,had. acknowledged that a sum of Rs. 2,84,63,3480 is due to the operational creditor and out of the said amount Rs. 50,00,000 l-will be paid on 06.06 .2024 and a 3d_ Ga

NCLT, Cuttack Bench CP(IB) No"52lCBl2024 sum of Rs"2,34,63,9481- on 90"06"2A24 but a sum of Rs" 50,00,000/- was paid by the applicant on 06.06.2024 and Rs. 50,00,000I - on 03.07.2024" Since the corporate Debtor was not clearing the dues of the operational creditor, the operation creditor was constrained to send a Third demand notice on 24.o7.2024 under Section B of IBC whereby it demanded a sum of Rs. l,9o,B7,3l2f - consisting of principal amount of Rs" 1,77,63,1391- and interest of Rs"13,24,ITSl-as on 28.OT.2024" Subsequently, the Corporate Debtor had released a further sum of Rs. 10,00,000/- on 05"08.2024 leaving a balance of Rs" 1,82,08,9651- consisting of principle amount of Rs. 1,67,63,1391- and interest of Rs. 14,4S,B2SI_ calculated till 06.o8.2024. 2.8 Hence a total debt due from corporate Debtor to operational creditor is Rs" 1,82,08,96s1- consisting of principle of amount of Rs. l,6T,6B,L3gl-being the amount of debt due against Invoice No. vEpL/oDlotl2s-24 dated 80"11"2o2s raised in terms of the contract dated or.og.2o23 and Rs. 14,45,8251- on account of interest on delayed payment for a period from 09.o4"2024 to 06.09.2024 @ 1g% per annum and no disputes whatsoever has been raised by the Corporate Debtor regarding the outstanding due. 3. The corporate Debtor/ Respondent made the following contentions in its reply: I 3" Respondent was engaged by Tata Steel Ltd. for execution of EPC work of Silico Manganese plant at Ferroy Alloy plant, Joda orissa on 09.0 r"2023 was to be completed in a time bound manner i.e" before 08.05.2024 and, in pursuance of that the Respondent entered a contract with the Applicant on 01.09"2023 but the Applicant did not make payment to their vendors which culminated in delay of the project. Therefore, Tata Steel Ltd expressed its displeasure with the Respon_dent for €jd_ 3a L

.illfilll3:,1)*iffil the delay being caused in the contract work and ultimately causing the project go beyond schedule. The Respondent had made every effort to impress upon the Applicant to make payment to vendors to avoid delay and expedite the work, but to no avail and, therefore, the Respondent had to terminate the contract on 23.1 I.2O2S. 3.2 The Applicant has served three demand notices i.e. on 05.03.2024,27.o5.2o24 and 24.02.2024 under section g of IBC and issuance of notice under Section 9 of IBC intermittently and multiple times to corporate Debtor is bad in law in light of the judgement in M/s Ultratech cement Ltd. vs M/s unluersq,l Journegs (rndta) put. Ltd. & ors. cp (IB) to2z/ND/zo2o dqted O7,O8,2O23 bg NCLT New Delht Bench, 3.3 The first notice by operational creditor dated o5.o3.2o24 demanded an amount of Rs. 4,g4,og,org/-consisting of principal amount of Rs. 4,76,69,469 / - and interest of Rs. 17,39,609/- although no provision for interest was made in the agreement. The claimed amount was subsequently revised to Rs.382 ,6g,lsgl-after reconciliation of accounts by operational creditor with the respondent. Subsequently, a settlement Agreement was entered into on og.04,2024 between the Applicant and the Respondent, whereby the outstanding amount was reduced to Rs. 3,82,6s,Lgg l-and this revision and settlement ipso facto indicates a pre-existing dispute. 3,4 once the settlement agreement was drawn and the claim amount has been reduced from Rs. 4,76,69,469/_ to Rs. 382,63,139/-, the operational creditor ought to have issued a credit note for the difference amount or revise / amend the invoice accordingly to claim a definite and cryst allized., but the applicant has failed to do so and as per Neeral Jqln us. cloudwalker streamrng Technologles prluqte Llmlted, and, Another [2o2o scc online NCLAT 44sl filing of invoices is sine sd Sd ._

NCI,T, Cuttack Bench CP(IB) No.52lCB/2024 qua non for section 9 applications pertaining to transactions where invoice is generated as part of the transaction. 3.5 There is a pre-existing dispute between the parties as is evident from the Emails exchanged with the Applicant on various dates corroborate the fact that due to the existing dispute and non-adherence to the timelines of the contract dated O1.O9.2O23 by the Applicant, the Respondent had to terminate the contract on 23.11.2023, It is only after the termination of contract that the Applicant came for a settlement on 09.04.2024. 3"6 The GST amount on the principal invoice amount of Rs. 4,03,97,855/- as per invoice dated 90.11 .2029 was Rs. 72,7r,6141- but after reconciliation of accounts the outstanding principal invoice amount was revised to Rs. 3,09,ZI,S2Sl-and accordingly the GST payable on the principal amount is Rs. 55,78,4741- and, for which, the difference in GST has been raised by way of debit note dated 10.08.2 o24 by the respondent. 3,7 The respondent has also deposited TDS to the tune of Rs.807957 l-deducted u/s 194c of the Income Tax Act, 196l on account of payments made to the applicant, which has been duly credited to the Income Ta;< Account of the applicant 3.8 In accordance to the settlement agreement the respondent was obligated to pay Rs. g82,63,139 l-which included an excess GST amount to the tune of Rs" 16,gg,l3gl-and the TDS amount already credited to the account of the applicant and hence the same should be deducted to compute the outstanding liability. Dates Amount Repayment Balance claimed Settlement 3,82,63,139.00 dated 09.o4.2024 (-) TDS 807,957.OO sA--- 3a F

NCIT, Cuttack Bench CP(IB) No"52/CB/20124 csr (-) 16,93,139.00 Return Debit note Crystallized 357 162,0,43.OO Amount t2.o4.2024 100,00,000.00 t8.o5.2024 25,00,000.00 06.06.2024 50,00,000.00 03.07.2024 50,00,000.00 05.o8,2024 10,00,000.00 L7.08.2024 55,00,000.00 290,OO,OOO.OO 67,72,O43.OO 3.9 The amount payable after deducting the TDS and excess GST stands at Rs. Bsz,62,04zl-out of Rs. 290,00,000/-stands paid and only Rs. 62,72,o43 remains unpaid which is below the threshold required to maintain an application u/s 9 of the Code. 3"10 rhe original agreement dated ol.ag"2023 and the settlement agreement dated 09.o4"2024, both this agreement contains arbitration clause and hence any dispute arising out of the said agreements shall be adjudicated through arbitration and hence this Adjudicating Authority is not the right forum to adjudicate on this dispute. 4. The applicant in response to the reply filed a rejoinder wherein it has submitted that: 4.L The present application was filed on 08.08.2024 for a default of Rs. 1,g2,08,9 6s l - which included interest till 06.08.2024 but subsequent to filing of this application the applicant has made a payment of Rs" 55,00,000/-on L7.o8.2o24 and issued a TDS certificate for Rs. g,oz,gsr l-and, even after adjusting both these amounts from the total due amount the total outstanding amount as on 24.o1,2o2s i.e. date of filing of the rejoinder stands at Rs. l,2},ro,gggl-consisting gA gd, J PageT of2l

NCLT, Cuttack Bench CP(IB) No.52lCBl2024 of principal amount of Rs" 1,04,s5,1s21- and interest of Rs" 23,55,917 I -. 4.2 The contentions of the respondent in regard to illegal termination of the contract by them that it was justified and it occurred due to noncompliance by the applicant is misleading and be that as it -ey, the respondent has agreed and acknowledged the debt amount due to the applicant in the settlement agreement dated o9.o4.2o24 and even through various emaii communications incruding email dated 06.06.2024. 4"3 Applicant had not issued the Demand notices multiple times qua the same amount of debt due, but the notices were issued for the reduced amounts, since the corporate Debtor kept on making part payments. The issuance of multiple notices by the Applicant was necessitated due to the reconciliation of the accounts and part payments made by the corporate Debtor and the reliance on M/s ultratech cement Ltd, vs M/s pfi, uniuersq.l Journeys (India) Ltd, (supra) is misplaced as the facts is totally distinguishabte as in that case the operational creditor issued 2 notices claiming the same amount and thereafter, on its own issued a third notice with reduced amount without even receiving any payment from the corporate Debtor. 4.4 In respect to imposition of interest the contract dated 01.09.2023, had no provision of interest for delayed payments. However, the Invoice dated 30.11 .2029 was duly received and acknowledged by the corporate Debtor vide email dated 06"12.2023 contained the clause regarding imposition of interest. It is well settled principal of law that invoice is a contract and the terms of interest mentioned in the same becomes payable if the payment is not made in time. The payment of interest for delayed payment was also acknowledged 3.1 - Sa

.$'ffihtHl?:1ilu1 in Settlement Agreement / MOU dated 09.04.2024 by the corporate Debtor and therefore, corporate Debtor cannot backtrack from the same at this stage. 4.5 The claimed amount in default was never revised to Rs" 3,82,61,139 in fact the reconciled amount Rs. 2,71,3 1,106 (Base Value) + Rs. 27,13,1 1 1 (Profit Margin @lO% of Base Value) + Rs. 72,71,614 (GST paid by applicant on invoice dated 30"11 .2023) + Rs. 10,93,361 (Salaries of StafQ + 2O,Sg,g4T l- (Interest calculated upto O9.O4,2O24) totaling to Rs, 4,02,63"1391- as recorded in the Settlement Agreement dated 09.o4.2024 and therefore, the amount of Rs" 3,82,63,1991- is incorrect, even as per the knowledge of the corporate Debtor which is evident from its email dated 06.06.2A24. 4,6 The execution of a settlement agreement shows the acknowledgment of the outstanding debt due hry the corporate Debtor after the reconciliation of accounts and the payment terms in a staggered manner on the dates mentioned in the settlement Agreement dated 09"o4"2o24. rt is submitted that mere existence of a settlement agreement or a reconciliation process cannot constitute a "pre-existing dispute" unless there is a categorical denial or dispute raised by the corporate Debtor concerning the debt in question for which the Applicant has approached the Tribunal and for which the demand notice in question was issued" The relevant demand notice pertaining to the present application was issued on is 24.02.2024 for Rs. l,9o,B7,3r2l-qua which there is no pre-existing dispute. that the corporate Debtor having admitted the outstanding debt and having agreed to pay the same, the same amounts to clear acknowledgment of debt being due and payable i.e. through email dated 06.06"2024 and belies the existence of any dispute.

4"7 The reliance on the judgment in Mobilox rnnouafions Priaate Limited u. Kintsq. software priaate Limited. t!2ots) GA- Srl \-- "$fi3hlHi);iilul r scc 3531 by the corporate Debtor is totally misplaced and does not apply in the facts of the case" The principal of traw cited by the corporate Debtor cannot be disputed but the corporate Debtor having admitted the outstanding operational debt and having agreed to pay the same, the same amounts to clear acknowledgment of operational debt being due and payable and belies the existence of any dispute. The corporate Debtor's failure to comply with the settlement agreement further negates its assertion of a pre-existing dispute. The corporate Debtor has neither denied the operational debt sought by the Applicant till the filing of the present Application nor provided any credible material to substantiate its defense of a pre-existing dispute qua the amount sought by the Applicant. 4,8 Deposit of TDS of Rs. g,OT,gSU - is a matter of record, however, the same was informed to the Applicant for the first time vide email dated lo.o}.2o24 i,e. subsequent to the filing of the present Application on 08.08.2024 and the TDS certificate for the same was sent by email dated 12.o9.2024 i.e. subsequent to the filing of the present Application.

In so far as the debit note qua GST is concerned, the same was also sent subsequent to the filing of the present Application on 12.o8.2024 and,the same has been explained in the Additional Affidavit dated 28.og.2024 filed by the Applicant. It is admitted that GST @ls% on the Invoice amount of Rs. 4,os,gr,B55/- raised by the Applicant comes to Rs. 72,7 7 ,674 I -. By the time, the settlement Agreement had taken place, the Applicant had already filed its GST Return and paid taxes to the tune of Rs. z2,zl,614/- and therefore, it was agreed that despite the Applicant agreeing to take the reduced amount for reasons explained herein above, the said GST will be completely paid by the Applicant and the same was duly recorded in the Settlement Agreement. 3"t S.l

NCLT, Cuttack Bench CP(IB) No.52lCB/2024 Auelysts aun Frrorrcs: 5, we have heard both the ld. counsels appearing for the parties and have perused the materials brought on record" It is an undisputed fact that the Corporate Debtor was handed over a contract for execution of trPC work of silico Manganese plant at Ferroy Allow plant, Joda, orissa and it has subsequently through an agreement dated ol,og,2a2a (hereinafter sub-contractor agreement) engaged the applicant as the sub-contractor for the said work" Subsequently the Sub Contractor agreement was terminated by the respondent vide email dated 23"11.2023" 6, The applicant pursuant to the termination raised an invoice No. vEPLloD loll23-24 on 30.11.2023 on the respondent for an amount of R.s.4,76,6o,4691- which included a principal amount of Rs. 4,o3,97,855/- and GST of Rs.72,zl,614l-. The said invoice contained an interest clause as per which an intere st was chargeable if it @I8o/o is not paid within the agreed time period i.e. after 2r days from submission of invoice. The said invoice was duly acknowledged by the respondent vide its email dated 06.12.2029" 7. The First Demand Notice u/s g of the code was sent by the applicant on 05.03 "2024, after which the applicant and respondent reconciled their accounts and entered into a settlement agreement on 09.o4.2024 (hereinafter "setflement Agreement,) to crystalize the outstanding amount payable by the respondent to the applicant. As per the settlement agreement the outstanding liability agreed between both the parties as on O9.O4.2O24 is as follows:

Actual Expenditure borne by Applican- 2,71,31, 106 lOo/o of the Actual Expenditure as profit 27,73,IL1 Reimbursement of total GST paid by 72,71,674 gd Sa Page tL of 2t

NCLT, Cuttack Bench CP(IB) No.52lCB/20124 Interest payable @LB% 20,53,947 Salary to employees 10,93,361

8' It was also agreed between the parties that the total due towards salary and interest amounts to Rs. 3l,4z,3og/- but if the respondent pays the outstanding amount within the time schedule as specified in the settlement agreement, then the applicant will waive off Rs. 2o,oo,ooo l-and the respondent wi[ be obligated to pay Rs. 11,47 ,3o81 - only out of the total liability of Rs. 3r,47 ,go8/-. Hence the liability of the creditor upon successful fulfillment of condition as stipulated in the settlement agreement was Rs. 3,82,6 a,rsg /- otherwise 9" The relevant clause of the settlement agreement is reproduced herein for brevity: "I',riz*r 'lr:v*ic sr * rr rs { d ir : r < : I u a {3 t'rt r{} r o er t } '} , { ih * r. } riDJl *rrtrr* {i.l*rrtr:r<.:t, });rrty }{..>. } ixrel ralis*d ar: {i } 'st'?*?3 fi:rr s i q lr 1 s 1 i 1 1 w **dis ,o 4 'l. e 7 6 p ,$ ri J o } r " 4 r 6 .* s r y e * ri i l r l } ir } r. * o t, i r o $ n r$ * * r f r t} t r rr * r ,: i l$ cr * . x ,r r : . r a r. c r; } r t c, t crlrfe<l 'I'bat Pi:rry s N in * c " rs l. I) r * u r l t d y i ! s rf x * l. r c Z t r < a $i c r l l r e r+ *u t r * r I r ll d $ r h t { l o :$ li s ir * . rv t} r a :l r c c s q r r t * } i j s .$ s* 3, b :{ y i r ? s * 1 } , " , I o lr r l r } - n ty r { N r r } : : . { * l, . I**irrr tliu;>lrrtius l:nv* aq;4111*iled thsir iicc*\"''rt$;urrl ir is ir*irccd tu ? l:i :{ t r t 'l } '* r i s ) r r } lr } t i y r* ? 1. r { * o rt i I * s i* tr w ra r, l r * ri J s : u i l i n rc { * r t r 'j x { l s e " x p p, r 7 .r r r, : } r li 1 lt, r r r 0 * $ t & ry i ri l } < s Jr r. t lc y b h y l$ pr * I t, y },{* 0 ?7 r' " $ ] ' j ' , 7 I $? I ] 3 /- iu t* r ! * v { R }r s d ' $ 7 p 2 r, * v l t i, f s r4 (i t ) - i l * * w V * b. *l i * n t) r $ e i r 'I. - r ls p; r g ic f r t c * l r r i in lr r i r n a s r *t r * d ;r * I r. t e. . * s { - . l :],? r, t 5"*3 t&. Ir is I'.rrr'*r ilgreerl r, Lrsrrvr*;r rrr* lx*..ies tlr;rt * si*:* o{,r{x, Iil,p:{,3$r/* i* riurv l,-v Pnrty h'*> ? t* rxrr(),'h{$ i tor.r,*r<r$ $arxri{r*, t:rc. il*cJ lt.s^ -k-- {n *u L$t\tfi^^*-^r-gd-= ,S.(

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10. Hence the revised timeline for payment as per the settlement agreement is as follows: Sl No. Amount Timeline/Due Date 1" Rs" 1,00,00,000/- 12.o4.2024 2. Rs. 1,40,00,000/- tt.o5.2024 3. Rs. 1 ,42,63,139 /- 25.O5.2024 Total Rs. 3182,63,Lgg l - (Computed after waiving off RS" 2O lakhs) 11. The respondent on the contrary has contended that as per the settlement agreement dated 09.o4.2024 tjne respondent was obligated to pay Rs.3,82,63,1391- and not Rs.4,02,6g,lgg /-" It is observed that the cD did make the 1st tranche of payment of Rs" 1 cr as per the time line mentioned in the settlement agreement but failed to comply with the remaining payment schedule, hence the creditor did not rgdr\ce the S& S"t

-

.ilfll;3:lj):1i;Ul liability of the debtor in terms of the agreement and the total liability as per the settlement agreement stood at Rs.4ro2r6grtggl-r, (Principal of Rs. g,B2,og,Lg2l-and Interest of Rs.20,53,942/-and interest was imposed on the reducing principal as per clause (iv) of the settlement agreement. *In the agreetnent dated og,og,zoz4 at clause (ta) the amount mentloned ls Rs.410216g117g/- uthlch ls incorrect L2. clause (iv) of the settrement agreement is as follows: ( v e,--tir,; 'lLrut i* case fte parry No.2 ibils (o p*y any of thc aforelaicl installmenrs, a* per the albresaid srhedule, rhcn the Farry No. I will b* enritled t' aibrc.$*id amount oIIL.i, 4,02,63,13g1_ (iv'ich ivill {:,: tlcenred to be the principnl amount) almrg with intsrest 0 lS% per iuuunt h0m 0g.04.2024 on rcducing balance afror d*creasing the tmount paicl in terms of ilre presrnl $ettlemeilt. 13. The total outstanding amount as per the submissions of the applicant which includes accrual of interest and the outstanding principal amount from the date of the settlement agreement on o9"o4"2o24 and till 06.08.2024 (the cut off date for computing debt) after deducting the payments made by the respondent in a nutshell is as follows: Time Period Amount Outstanding Interest Levied as (Date outstanding onf per agreement dated O9"O4"2O24 09.o4.2024 4,02,63,139 /- 4,O2,63,139 + 39,T19 = 18% interest on 10.o4.2024 4r03r0.2rg57- I - 4,O2,63,138 for 2 to Itt.o4.2O24l days is 11.o4.2024 Rs. 39,7121-gd gd =? t -+--F

NCI,T, Cuttack Bench CP(IB) No"52lCB/2024 Payment of Rs 1 Cr on LZ,O4.2OZ4 (Reduced Principal - 4102,63,188- l,OO,OO,OOO = g,02,60,lgg/-) 3,O2,63,139 + 39,712+ 18% interest on 72 "A4.2A24 5,37 ,274 = 3,O716O r7OL 3,O2,63,139 on to (17.o5.2024l, principal for 36 77.O5.2024 days Rs. 5,37,2741- Payment of Rs 25 Lakhs on 18.OS,20124 (Reduced Principal- 31012160,1g8 - 2S,OO,OOO = Z,7Z16g118gl-) 2,77,63,139 + 39,712+ l9o/o interest on t8.o5.2024 5,37,274 + 2,60,137 = 2,77,63,138 for 19 to 2rg610,0,262l - days is 05.06.2024 lo5.0,6.2O24l Rs. 2160 rL37 l- Payment of Rs. 50,00,000 on O6.O6.20124 (Reduced Principal- 2,77,69, 198- SO,OO,OOO = 2122,6g, lgg/_) 2,27,63,139 + 39,71.2+ 18% interest on 06.06.2024 5,37,274 + 2,60,132 + 2,27,63,t38 for 27 to 3,03,093 = 2139 rO3r355/- days is o2.o7.2024 lo2,o7.2O24l Rs" 3,OB ,0,9i31- Payment of Rs. 50,00,000 on O3.OZ.ZO24 (Reduced Principal- 2r27 169, 148- SO,OO,OOO =L rZZ 16g, lgg/_) I,77,63,139 + 39,7L2+ 18% interest on o3.o7 .2024 5,37,274 + 2,60,132 + 1,77,63,138 for 33 to 3,03,093 + 2,89,O22 = days is 04.o8.2024 l,gl,92,432l - Rs. 2,89,O771-lo3.o7.2O24l Payment of Rs" 10,00,000 on OS.Og.2OZ,4 (Reduced Principal- 1,72,69, 198- 1O,OO,OO O =1 167,6g, 1gg/_) 1,67,63,139 + 39,712+ 18%o interest on 05.o8.2024 5,37,274 + 2,60,132 + r,67,63,138 for 2 to 3,03,093 + 2, 06.o8.2024

Sa Ga

NCLT, Cuttack Bench CP(IB) No.52lCB/2024 89,077 + 16,533 = days is 1,82,O9,9651- Rs.16,533/- 10,6.o8.2o24l

Total Outstanding Principal Total Interest as Time Period as on O6.0E.20?4 as on 06.08.2O24 as submitted in Part IV of submitted in Part application IV of application 09.o4.2024 to Rs.1,67,63,138 Rs.14,45,287 06.o8.2024 1'4. It is observed that both the parties after reconciliation of their book of accounts entered into the agreement dated og.o4.2o24 and has clearly agreed to the outstanding due amount to be Rs. 4,02,6g,lsgl-as clear from Clause (iv) the settlement agreement reproduced at parq. 12 of thls order. It is true that there existed a proposition wherein the applicant had agreed to waive off Rs.2o,oo,0o0/- if the respondent adheres to time timeline stipulated in the settlement agreement and since evidently the same ahs not been done. It cannot be said that the total debt amount outstanding on the date of settlement agreement was Rs. 3182r6grlggl - and not 41012163.11.g9l_ 15. The respondent further has contended (computation reproduced. at para 3.8 of this order)that out of the outstanding liability as per the settlement agreement which according to respondent is Rs. 3,82,63,1391- and it has made payments to the tune of Rs. 2,9o,oo,ooo / - and has issued a TDS to the applicant to the tune of Rs. 8o7,957 /-.

It is also contended that there is an excess GST payment to the tune of Rs. 16,93,139 /- which has been raised by way of a debit note 10.O8.2024. Hence the remainder liability of the respondent is only to the tune of Rs.67,72,O43 only which falls below the threshold of Rs.1 Crore" 3.1 _3d "illfillr3:11":"7;ffi2 16. In regard to the TDS payment, it is noted from the TDS Deposit slip in F-16A thatTDS to the tune of Rs,B,Oz,gsrl-was deposited in the PAN account of the appricant on 31.03.2024. Hence the TDS deposit of Rs" S,ozrgszl-shalr be deducted to compute the threshold" 11. The respondent has further contended that the GST amount payable by the respondent was in excess of Rs. 16,93, lsg l-as the base amount has changed subsequent to the revision" It is observed that the triability of GST of Rs" T2,T r,614l-was clearly stated in the settlement agreement and the same was acceded to by the respondent by entering into the settlement agreement. Furthermore, it is observed that the respondent has duiy acknowledged the outstanding due through his email on 06.06"2024 which included the csr iiability.

This Adjudicating Authority does not have the subject jurisdiction to rnake any observation on the correctness of the computation of the GST amount post re-conciliation. This Adjudicating Authority is bound to adjudicate based on the records brought before it. Hence, no observation is made regarding the correctness of GST computation albeit the same was agreed by both the parties. 18. It is also observed that the GST Debit note was issued only on lO"OB.2024 that is 2 days after the present application was filed. It is also noted that the respondent has failed to show any form of communication whatsoever after entering into the settlement agreement that he has raised any issue regarding the GST liability, on the contrary as noted above it has duly acknowledged the same in email dated 06.06"2024. 19" The respondent has also contended that it has made a payment of Rs"55,00,000/- on 17.08 .2024 to the applicant and hence the same shall be deducted while computing the threshold amount. 20. At this juncture, we are inclined to refer to ajudgement of Hon,ble NCLAT in Deuika Resources put Ltd (Formerly known as Kg,linga e 3d .?

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.$fllr3:I?":"7;;;i Enterprlses Put, Ltd) u IUIAA Mqnasha Deal Affiogs pt t. Ltd, [cA(AT)(Ins/ ivo.939/2o24lwherein while remanding back the matter back to this very Adjudicating Authority the Hon'ble Appellate Tribunal, by relying on the judgements of the Hon'ble Apex court in RaJamundry Electric supplg corporatlon Limrted. vs. A Nageshwq,rq, Rolo & ors., (1995)2 scR 1066, Mqnlsh Kumqr vs, tJnion of India, (2021) 5 scc r and a decision of Hon'ble NCLAT in Hgtine Medoconz put. Ltd. vs. Anqndq,loke Medlcal centre pfi. Ltd., cA (AT) (Ins) No, 1036 of 2o22 declded on 2o.o9"2o22 held at para 18 of its judgment that the time of the admission of the application. 2L. Hence both the issuance of GST debit-note and payment of Rs.55,00,oool- \r/as done after the present application was filed and hence the same cannot be considered for computing the threshold amount uls 4 of IBC, 2016. It is also pertinent to state here that the applicant in his rejoinder has re-computed the outstanding liability by adding interest that has arose since the date of filing of this application upto the date of filing of the rejoinder, even that interest component cannot be considered to evaluate the threshold. 22. Hence as on the date of fiting of this present application i.e. on 08'08'2024 (or 06.08.2024 as stated. in Part-IV) the total outstanding liability of the respondent was Rs. Lrz4rol,oog/- (Rs.1,82,08,96s - 8,o7,957) which is above the requisite threshold as required u/s 4 of rBC 20 16. 23, There is no evidence of any pr-exiting dispute between the parties post the settlement agreement on og.o4.2o24 till the present application was filed. Furthermore, the original invoice was raised by the applicant on 30.1 1 .2023 and the date of default as mentioned in Part-IV is 22.12.2o2s i.e. after end of 21 days from acknowledgment of invoice and the settlement agreement was entered on 09.04 .2024 and the last part payment was made by the respondent on 05.08.20 24_Jpre- Sdz Sa

NCI.T, Cuttack Bench CP(IB) No"52/CB/2024 initiation date) and 17"08.2024 (post initiation date). All these actions have occurred within 3 years period of the initiation date hence the present application is well within limitation. 24" In light of the above observations, we are inclined to hotd that there exists an outstanding operational debt, a default and hence the present Petition bearing cP (IBc) No. S2lCBlzo24 under Section 9 of the code read with Rule 6 of the Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 20t6 for initiating cIRp of ATMASTCO LIMITED Corporate Debtor is ,ADMITTED,. 25" The Moratorium under section t4 of the Insolvency and Bankruptcy Code, 2016 is declared for prohibiting all the following in terms of section 14(1) of the Code - 25"1 the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree, or order in any court of law, tribunal, arbitration panel or other authority; 25.2 transferring, encumbering, alienating, or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; 25"3 any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2OO2; 25.4 the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor" 26. The order of moratorium shall have effect from the date of this order till the completion of the Corporate Insolvency Resolution process until this Adjudicating Authority approves the Resolution plan under sub-section (1) of section 31 or passes an order for liquidatlon of Sa 3d

NCLT, Cuttack Bench cP(IBl No"52lCBl2024 corporate Debtor under section 33 of the Insolvency & Bankruptcy Code, 2Arc. 27. Sambhu Lal Agarwat having IBBI regd No. IBBI/IPA-OOI/Ip- POO387/ 20t7-t8/ 10698 is appointed as Interim Resolution professional, subject to him possessing a valid Authorisation for Assignment. 28. The IRtr so appointed shall make a public announcement of initiation of Corporate Insolvency Resolution process (CIRP) and call for submission of claims under section 1s as required by section 13(1)(b) of the Code. 29' The supply of essential goods or services to the corporate debtor, if continuing, shall not be terminated or suspended, or interrupted during the moratorium period. The corporate debtor to provide effective assistance to the IRp as and when he takes charge of the assets and management of the corporate debtor. 30" The IRP shall perform all his functions as contemplated, interalia, by sections 17, IB,20 & 21of the Code. It is further made clear that all personnei connected with corporate Debtor, its promoter or any other person associated with management of the Corporate Debtor are under legal obligation under section 19 of the code extending every assistance and co-operation to the Interim Resolution Professional. Where any personnel of the corporate Debtor, its promoter or any other person required to assist or cooperate with IRp, clo not assist or co-operate, the IRP is at liberty to make appropriate application to this Adjudicating Authority with a prayer for passing an appropriate order. 31. The IRP shall be under duty to protect and preserve the value of the property of the 'corporate Debtor'and manage the operations of the corporate Debtor as a going concern as a part of obligation imposed by section 2a of the Insorvency & Bankruptcy code ,20L6. 3.2" The IRP/RP shall submit to this Adjudicating Authority periodical reports concerning the progress of the cIRp in respect ,f the corporate Debtor. 9a- '..--, t -+-

33. The Financial creditor shall deposit a sum of Rs"r,oo,ooo/- (one Lakh only| with the within two weeks from the date of receipt of this order for the purpose of smooth conduct of corporate Insolvency Resolution Process (CIRP) and IRP to file proof of receipt of such amount to this Adjudicating Authority along with First progress Report. subsequently, IRp may raise further demands for Interim funds, which shall be provided as per Rules. 34. In terms of section 9(s)(i) of the code, the Registry is hereby directed to communicate a copy of this order to the Financial creditor, corporate Debtor and to the Interim Resolution professional and the concerned Registrar of companies, within seven (7) working days and upload the same on website immediately after pronouncement of the order. 35, The IRp shall also serve a copy of this order to the various departments such as Income Tax, GST, state commercial Tax, and Provident Fund etc. who are likely to have their claim against Corporate Debtor as well as to the trade unions/employee,s associations so that they are informed of the initiating of clRP against the corporate Debtor timely. 36" The commencement of the corporate Insorvency Resolution Process shall be effective from the date of this order. 37. The Resolution professionar shail submit his periodic reports before this Adjudicating Authority as per rures/regulations.

3a S.{ BANWARI LAL MEENA DEEP C}T+rONA JOSHI Member (Technical) Member (Judicialf

This Order is signed on 29th Day of August 2Cl25.

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