M/S Ss Steels vs M/S Shahi Infrastructure Pvt. Ltd

SS Steels ...Appellant(s)

Versus

Shahi Infrastructure Pvt. Ltd. ...Respondent(s) Present: For Appellant : Mr. Rajesh Ranjan, Mr. Sohaib Alam, Advocates. For Respondents : Mr. Akhil Shankhwar, Advocate.

ORDER

(Hybrid Mode) 16.10.2024: Heard Counsel for the Appellant as well as Counsel for

the Respondent.

2. This appeal has been filed against the order dated 30.05.2023 by

which order Section 9 application filed by the appellant has been dismissed/

rejected.

3. The Adjudicating Authority in paragraph 10,11,12, and 13 has made

following observations:

"10. We have heard the submissions made by Ms. Shankari Mishra, Ld. Counsel appearing for the Applicant as well as Mr. Akhil Shankhwar, Ld. Counsel appearing for the Corporate Debtor and perused the records.

11. The Operational Creditor has deliberately failed to serve and annex any document in support of the claim evidencing the occurrence of default on the part of the corporate debtor and reflecting any liability.

12. In view of the above, it is established that the corporate debtor had raised certain issues relating to the restrained cheques issued by the corporate debtor, much before the

CA (AT) (Ins) No. 1143 of 2023 2

issue of the statutory demand notice by the operational creditor.

13. In the facts and circumstances of the instant case, we are of the view that the corporate debtor has been able to raise a plausible contention regarding the demand notice and the existence of pre-existence of "dispute" between the parties. Consequently, we conclude that the instant application filed under Section -9 is not maintainable.

Hence, we are inclined to dismiss this application".

4. Ld. Counsel for the Appellant challenging the order submits that

Adjudicating Authority has closed the right of Respondent to file the reply

since despite the time which was granted no reply was filed and Corporate

Debtor was granted liberty to file written submissions within three days vide

order dated 13.04.2023, taking benefit of the said liberty along with written

submissions facts were pleaded by the corporate debtor which has been

relied.

5. It is submitted that there was no material to indicate any pre-existing

dispute and the demand notice was not defective as observed by the

Adjudicating Authority.

6. Ld. Counsel for the Respondent submitted that no demand notice was

served on the corporate debtor hence the Section 9 application deserves to

be rejected.

7. We have considered the submissions of the Counsel for the parties

and perused the record.

8. The finding which have been returned by the Adjudicating Authority

as extracted above does not indicate that on the issue of service of demand

notice there is any finding by the Adjudicating Authority.

CA (AT) (Ins) No. 1143 of 2023 3

9. Adjudicating Authority has only noticed certain issues raised relating

to the restrained cheques issued by the corporate debtor, much before the

issue of the demand notice and on the said observation Adjudicating

Authority has jumped on the conclusion that there is plausible contention

regrading pre-existing dispute.

10. We are of the view that there were no such facts on which any

conclusive opinion regarding any pre-existing dispute can be made. In the

facts of the present case we are of the view that the ends of justice be served

in. Setting aside the order impugned and remitting and reviving the Section

9 application before the Adjudicating Authority for fresh consideration.

11. In view of the fact that the matter is been sent back to the

Adjudicating Authority; we are inclined to grant two weeks' time to the

corporate debtor to file the reply to the Section 9 application. Adjudicating

Authority may fix a date after four weeks and decide the application in

accordance with law.

12. With above observation, the appeal is disposed of.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical) sr/nn

CA (AT) (Ins) No. 1143 of 2023