Kishore Shanker Signapurkar vs Prime Soles And Anr

Kishore Shanker Signapurkar ...Appellant

Versus

Prime Soles and Anr. ...Respondents

Present:

For Appellant : Mr. Manu Yadav, Advocate

For Respondent 1 : Dr. Anurag Kumar Agarwal and Aman Bahl, Advocates.

ORDER

29.01.2019 This appeal has been preferred by Mr. Kishore Shanker

Signapurkar, Shareholder of 'Signapurkar's Leather House Private Limited' -

('Corporate Debtor') challenging the order dated 01.08.2018 passed by the

Adjudicating Authority (National Company Law Tribunal), Mumbai Bench,

Mumbai, whereby and whereunder, the application under Section 9 of the

Insolvency and Bankruptcy Code, 2016 ("I&B Code" for short) preferred by the

Respondent 'Prime Soles'- ('Operational Creditor') has been admitted.

Contd/-...................

-2-

2. Learned Counsel appearing on behalf of the Appellant referring to the

records submitted that there was pre-existing dispute and thereby the

application u/s 9 was not maintainable.

3. Learned Counsel for the Respondent submitted that letter relied by

learned Counsel for the Appellant do not relate to the invoice in question.

4. We have heard learned Counsel for the parties and perused the records.

5. Before the Adjudicating Authority, the Respondent ('Operational Creditor')

pleaded that the 'Corporate Debtor' committed default in making payment of Rs.

75,54,595/- against supplies made between year 2012 and 5th August, 2017.

6. It is not in dispute that after 5th August, 2017 the Respondent

('Operational Creditor') had issued notice u/s 138 of Negotiable Instrument Act

on 27.11.2008 with regard to bounce of cheque issued by the 'Corporate Debtor'

towards the dues aforesaid.

7. The 'Corporate Debtor' in reply (through its Counsel) intimated the

Respondent ('Operational Creditor') that the cheques were issued on the

assurance of the 'Operational Creditor' for supply of goods. The 'Corporate

Debtor' thereafter noticed that the quality of goods supplied were not upto mark

and for the same reason the 'Corporate Debtor' asked not to release the payment. -3-

8. From the aforesaid fact, it is evident that much prior to issuance of

Demand Notice u/s 8(1), the 'Corporate Debtor' raised the question of standard

of goods supplied by the 'Operational Creditor' upto 5th August, 2017. The

Adjudicating Authority failed to notice the aforesaid pre-existing dispute and

admitted the application u/s 9.

9. For the reason aforesaid, we set aside the impugned order dated

01.08.2018.

10. In effect, order (s) passed by Ld. Adjudicating Authority appointing 'Interim

Resolution Professional', declaring moratorium, freezing of account and all other

order (s) passed by Adjudicating Authority pursuant to impugned order and

action taken by the 'Resolution Professional', including the advertisement

published in the newspaper calling for applications all such orders and actions

are declared illegal and are set aside. The application preferred by the

Respondent- 'Prime Soles' under Section 9 of the ''I&B Code' is dismissed. The

Adjudicating Authority will now close the proceeding. The 'Corporate Debtor' is

released from all the rigour of law and is allowed to function independently

through its Board of Directors from immediate effect.

10. The Adjudicating Authority will fix the fee of 'Interim Resolution

Professional' and the 'Corporate Debtor' will pay the fees for the period he has

functioned. The appeal is allowed with aforesaid observations and directions. -4-

However, in the facts and circumstances of the case, there shall be no order as

to cost.

[Justice S.J. Mukhopadhaya] Chairperson

[ Justice Bansi Lal Bhat ] Member (Judicial)

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