Ramco Systems Ltd vs Spicejet Ltd. & Anr

(Arising out of Order dated 14th December, 2017 passed by the Adjudicating Authority (National Company Law Tribunal), Bench-III, New Delhi in C.P. No. IB-316/ND/2017)

IN THE MATTER OF:

Ramco Systems Ltd. ...Appellant

Vs.

Spicejet Ltd. ...Respondent

Present: For Appellant: - Mr. Neeraj Malhotra, Senior Advocate with Mr. Rajdev Singh, Mr. Ritesh Khare, Ms. Deepika Kumari, Mr. Akhilesh, Mr. Azeem, Ms. Nikita Anand and Mr. Rajesh Sivaswamy, Advocates.

For Respondent:- Mr. Virendra Ganda, Senior Advocate with Mr. Abhishek Sharma and Ms. Ashly Cherian, Advocates.

J U D G M E N T

SUDHANSU JYOTI MUKHOPADHAYA, J.

The Appellant- 'Ramco Systems Limited'- ('Operational Creditor')

filed an application under Section 9 of the Insolvency and Bankruptcy

Code, 2016 ("I&B Code" for short) against the 'Spicejet Limited'-

('Corporate Debtor'). The Adjudicating Authority (National Company Law

Tribunal), Bench-III, New Delhi, by impugned order dated 14th

December, 2017, dismissed the application on the ground of

inconsistency in the overall payments and the non-compliance with the 2

provisions of Section 9(3)(c) by the 'Operational Creditor', in the absence

of a certificate from the financial institution maintaining accounts of the

'Operational Creditor'. The Adjudicating Authority further observed that

the 'Corporate Debtor' on the other hand shown that certain payment

has been made.

2. The brief facts of the case is that the Appellant- 'Ramco Systems

Limited' and the Respondent- 'Spicejet Limited' entered into 'Aviation

Software Solutions Agreements' dated 13th May, 2013 consisting of four

Agreements, all dated 13th May, 2013 namely, 'General Terms &

Conditions', 'Software License Agreement', 'Professional Services

Agreement' and 'Software Support Agreement'.

3. Subsequent thereto on 1st July, 2014, the 'Change Order

Demand' was executed between the parties. The earlier 'Software

License Agreement' for 180 number of Authorised Users were amended

to 55 Aircraft Tails and unlimited users with other amendment and

modification which also followed various modification and alteration on

1st July, 2014.

4. Learned counsel for the Appellant submitted that huge amount is

payable by the Respondent- 'Spicejet Limited' and invoice for Rs. 62.89

Lakhs were intimated to them by e-mail sent on 19th January, 2016.

Same relates to documents one dated 30th May, 2013 and two both

dated 23rd July, 2014.

Company Appeal (AT) (Insolvency) No. 31 of 2018 3

5. Reliance has been placed on the Auditor's Report of 'Spicejet

Limited' whereby the Appellant was intimated that the Auditors have

been engaged to perform the limited review of 'Spicejet Limited' for the

quarter ending 31st December, 2015 and as a part of their audit

procedure, they are required to obtain confirmation of balances directly

from vendors.

6. Learned counsel for the Respondent submitted that all claims

depended on invoices for the year 2013-14 including the invoice dated

23rd July, 2014 which was due and payable by 22nd August, 2014. It is

submitted that they are barred by limitation.

7. Learned counsel appearing on behalf of the Appellant referred to

the e-mail dated 19th January, 2016 of Spicejet Auditors to suggest that

it is not barred by limitation.

8. The Demand Notice under Section 8(1) was issued by the

Appellant on 24th April, 2017 without attaching the invoices relating to

debt which are payable. The Respondent has taken plea that Invoice No.

INAVN/DIN2/0001/15 for an amount of Rs. 59,83,170.00/- and Invoice

No. INAVN/DIN2/0002/15 for an amount of Rs.33,70,800.00/- both

dated 23rd July, 2014 had never been issued by the Appellant to the

Respondent.

Company Appeal (AT) (Insolvency) No. 31 of 2018 4

9. It is also stated that the Appellant has claimed an amount of

Rs.1,42,88,750/- for the unbilled license dated 13th March, 2013.

10. There is nothing on the record to suggest that the invoices dated

23rd July, 2014 were forwarded or received by the Respondent- 'Spicejet

Limited'. Therefore, the Demand Notice issued on 24th April, 2017 as

relates to invoice dated 23rd July, 2014, though it cannot be held to be

barred by limitation, but in absence of specific evidence relating to

invoices actually forwarded by the Appellant and there being a doubt,

we hold that the Adjudicating Authority has rightly refused to entertain

application under Section 9 which requires strict proof of debt and

default.

11. For the reasons aforesaid, no relief can be granted. However, the

order passed by this Appellate Tribunal or the Adjudicating Authority

will not come in the way of the Appellant to move before the Court of

Competent Jurisdiction for appropriate relief.

12. The appeal is dismissed with aforesaid observations. No costs.

[Justice S.J. Mukhopadhaya] Chairperson

[Justice Bansi Lal Bhat] Member (Judicial)

NEW DELHI 8th May, 2019 AR

Company Appeal (AT) (Insolvency) No. 31 of 2018