M/S. Oxygen Communications & Anr vs M/S. Iris Computers Ltd
- CitationCompany Appeal (AT) (Insolvency) No. 264 of 2017
Ratio decidendi
The rule this decision rests on
The appellate bench holds that where a dispute over the operational debt was raised before the demand notice under Section 8(1) of the Insolvency and Bankruptcy Code, 2016 was issued, an application under Section 9 is not maintainable, since the existence of a dispute prior to the notice defeats the application. A demand notice under Section 8(1) of the Insolvency and Bankruptcy Code, 2016 issued by an Advocate and Solicitor firm, rather than by the operational creditor itself, is not a valid notice for the purposes of Section 9, and an application founded on such a notice is not maintainable, following the view taken in Uttam Galva Steels Limited v. DP Deutsche Forfait AG & Anr.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
M/s. Oxygen Communications & Anr. ...Appellants
Versus
M/s. Iris Computers Ltd. ...Respondent
Present: For Appellants: Mr. Sanjeev Kumar Singh and Mr. Shighra Kumar, Advocates.
For Respondent:
ORDER
13.11.2017 - The Appellants-'Operational Creditor' filed an
application under Section 9 of the Insolvency and Bankruptcy Code,
2016 (hereinafter referred to as "I&B Code") for initiation of 'Corporate
Insolvency Resolution Process' against the Respondent-'Corporate
Debtor'. The Adjudicating Authority (National Company Law Tribunal),
New Delhi Bench, New Delhi, by impugned order dated 27th September,
2017 dismissed the application on the ground of 'existence of dispute'
giving raise to the present appeal.
On hearing learned counsel for the Appellants and learned
counsel for the Respondent and perusal of the record, we find that
purported notice under sub-Section (1) of Section 8 of the 'I&B Code'
was issued by an Advocate and Solicitor firm on 8th August, 2017. Prior -2-
to that pursuant to the notices dated 23rd March, 2017 and 20th April,
2017 issued by the Appellants, the Respondent disputed the amount on
30th May, 2017. Apart from this, we find that the purported demand
notice issued under sub-section (1) of Section 8 of the 'I&B Code' is not
by the Appellant-Operational Creditor' but by the Advocates and
Solicitors firm.
As there is an 'existence of dispute' since prior to issuance of
notice under sub-section (1) of Section 8 of the 'I&B Code', and we find
that the purported notice under sub-section (1) of Section 8 of the 'I&B
Code' has been issued by Advocates and Solicitors firm, which is not
permissible as held by this Court in "Uttam Galva Steels Limited v.
DP Deutsche Forfait AG & Anr. in Company Appeal (AT)
(Insolvency) 39 of 2017", the application under Section 9 was not
maintainable.
We find no merit in this appeal. It is accordingly, dismissed.
However, in the facts and circumstances of the case, there shall be no
Order as to cost.
Justice S.J. Mukhopadhaya) Chairperson
(Justice A.I.S. Cheema) (Balvinder Singh) Member (Judicial) Member(Technical)
AR/uk
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