M/S. Ahluwalia Contracts (India) ... vs Logix Infratech Private Limited

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI Company Appeal(AT) (Insolvency) No. 696 of 2022 IN THE MATTER OF: Ahluwalia Contracts (India) Ltd. ...Appellant Versus Logix Infratech Pvt. Ltd. ...Respondent Present: For Appellants : Mr. Nikhil Nayyar, Sr. Advocate, Mr. Paras Mittal, Mr. Mritunjay Kr. Singh, Mr. Dhruv Rohatgi, Ms. Shairya Singh, Advocates

For Respondent : Mr. Nitish K. Sharma, Advocate

ORDER

08.09.2022: Heard Learned Counsel for the Appellant as well as Learned

Counsel appearing for the 'Corporate Debtor'.

2. This appeal has been filed against the order dated 03.06.2022 passed by

the Adjudicating Authority in CP (IB)No.882/ND/2022 in the application filed

by the Appellant u/s 9 claiming an amount of Rs. 7,72,00,000/-.

3. The Adjudicating Authority issue notice to the parties and after hearing

the parties, had rejected the application on the ground that for breach of

settlement agreement, application u/s 9 is not maintainable since the dues

arising out of settlement may not be an 'operational debt'.

4. The Appellant challenging the order, contends that the Appellant was

Operational Creditor who was awarded contract by the Corporate Debtor to Company Appeal(AT) (Insolvency) No. 696 of 2022 1 carry on civil and structural work. It is submitted that after the award of

contract, final bill for payment was prepared which was duly signed by both the

parties. Consequently, Memorandum of Understanding / settlement agreement

was entered between the parties on 30.09.2019 where the earlier contract as well

as the subsequent Memorandum of Understanding were referred as to contract

and according to settlement agreement, the amount of Rs. 11 crores was to be

paid to the Appellant towards work done under the contract. It is submitted

that there being breach in the payment to the Appellant/Operational Creditor,

the application was filed u/s 9 which has been wrongly rejected.

5. Learned Counsel for the Respondent has supported the order of

Adjudicating Authority. However, he does not dispute that Corporate Debtor was

unable to make the payment to the Appellant as per Memorandum of

Understanding and as per the final bill certificate signed by both the parties.

We have considered the submissions of the parties and perused the

records.

6. Present is a case, where the Appellant was awarded contract by the

Corporate Debtor for construction of 'Logix Group Blossom Green' Project and

another work was awarded on 11.07.2014 to construct balance work of non

tower area for same project.

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7. The Operational Creditor has carried out the work and as per the final bill

certificate, an amount of Rs. 11 crores was to be paid. Subsequently,

Memorandum of Understanding was entered on 30.09.2019 laying down the

manner of payment of Rs. 11 crores amount on breach of which compelled the

Appellant to file section 9 application.

8. The Adjudicating Authority has in the impugned order relied on the two

orders passed by NCLT and has held that Applicant is not covered as

Operational Creditor, hence the application is not maintainable.

9. Present is a case where the Appellant was awarded the contract to carry

on construction and structural work and the dues claimed by the Appellant are

operational debt. The Memorandum of Understanding entered between the

parties was only with regard to mode and manner of payment, that too after

final bill certificate which was duly signed by both the parties.

10. Adjudicating Authority did not consider the nature of transaction between

the parties and has erroneously come to the conclusion that section 9

application was not maintainable. The judgement of Adjudicating Authority

cannot be sustained.

11. Learned Counsel for Respondent has also fairly submitted that Corporate

Debtor is unable to make payment.

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12. In view of the above, we allow the appeal by setting aside the order of

Adjudicating Authority directing the Adjudicating Authority to pass an order of

admission and other consequential order within a period of four weeks from the

date of receipt of this order. The appeal is allowed accordingly.

[Justice Ashok Bhushan] Chairperson

[Mr. Barun Mitra] Member (Technical)

ss/nn

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