Rushabh Sealink And Logistics Pvt Ltd vs Vaut Food Trading Pvt Ltd

IN THE MATTER OF: Rushabh Sealink and Logistics Pvt. Ltd. ...Appellant

Versus Vaut Food Trading Pvt. Ltd. ...Respondent

Present:

For Appellant : Mr. Pradnyesh Sabnis, Advocate.

For Respondent : Mr. Santosh Kumar, Advocate.

ORDER

(HYBRID MODE)

05.03.2024 This appeal is directed against the order dated 10.11.2022

by which application filed by the Appellant as an Operational Creditor has been

dismissed on the ground that he does not meet the threshold as provided in

Section 4 of the Insolvency & Bankruptcy Code, 2016 (in short 'Code'). In brief

the Appellant has filed the application on the prescribed form for the total

amount of debt of Rs. 1,22,22,500/-.

2. It is alleged that in part 4 of the application that as per the invoices, the

outstanding amount which is sought to be resolved is Rs. 99,77,551/- and the

rest of the amount is the competent of interest.

3. The application was contested by the Respondent herein by filing the

Reply in which one of the issue was raised that the application does not meet

the threshold as prescribed under Section 4 of the Code.

4. The Tribunal found that the principal amount claimed by the Appellant

is Rs. Rs. 99,77,551/-, whereas the minimum amount of threshold is

Rs. 1,22,22,500/-. Therefore, the Tribunal has no pecuniary jurisdiction to

entertain the application filed under Section 9 by the Appellant.

5. Counsel for the Appellant has referred to a decision of this Court

rendered in the case of Prashant Agarwal Vs. Vikash Parasrampria & Ors.,

Company Appeal (AT) (Ins.) No. 690 of 2022 decided on 15.07.2022. In which

it has been held that the interest of competent has also to be taken into

consideration at the time of deciding about the threshold to invoke the

pecuniary jurisdiction. However, to be fair with the court, he has submitted

that in that case interest was provided in the invoices, whereas in the present

case there is no provision of interest in the invoices raised by the Appellant.

6. He has otherwise submitted that the Respondent had issued the cheque

of an amount of Rs. 99,77,551/- on 05.03.2020 which was dishonoured

because the payment was stopped by the drawer.

7. He has referred to Section 80 of the Negotiable Instruments Act, 1981 to

content that even if there is no agreement between the parties in regard to the

payment of interest on a instrument yet the interest has to be calculated @ 18% per annum from the date on which the same ought to have been paid

and the party shall charge the interest until the principal amount is tendered

or released.

8. On the other hand, Counsel for the Respondent has submitted that

Section 80 of the Negotiable Instruments Act, 1981 is not applicable, as it

relates to recovery proceedings. He has also submitted that even otherwise

the cheque dated 05.03.2020 was towards security and not towards discharge

of liability.

9. All these arguments have been placed before us and it appears that these

were not placed before the Tribunal.

10. In such circumstances, we are of the considered opinion that it would be

just expedient if the Impugned Order is set aside as no effective order on merit

has been passed except that the application filed by the Appellant has been

dismissed on threshold for the lack of pecuniary jurisdiction and the parties

are relegated back to the Tribunal where they would raise all these issues,

which are raised before us and the Tribunal shall decide the same in

accordance with law.

11. Accordingly, the Impugned Order is hereby set aside, the matter is

remanded back to the Tribunal.

12. The parties are directed to appear before the Tribunal on 20th March,

2024.

13. The application bearing C.P. (IB)-853(MB)/2021 is restored. It is made

clear that we have not made any observations on the merits of this case and all

the issues have been kept open in respect of decision of the threshold.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Mr. Indevar Pandey] Member (Technical) Sim/Ravi