Suman Chkraborty vs Anhui Technology Imp. & Exp. Co. Ltd

Suman Chakraborty ...Appellant

Vs

Anhui Technology Imp. & Exp. Co. Ltd. ....Respondent

Present: For Appellant: Mr. Abhigyan Choudhury and Mr. Ateendra Saumya Singh, Advocates. For Respondent: Mr. Pranav Chadha, Mr. Arvind Kumar Gupta and Ms. Henna George, Advocates for R-1. Mr. Amit Bhatnagar and Mr. Gautam Singhal, Advocates for IRP.

ORDER

07.01.2020: Pursuant to application under Section 9 of the Insolvency and

Bankruptcy Code, 2016 (hereinafter referred to as 'I&B Code') filed by 'Anhui

Technology Imp. & Exp. Co. Ltd.' (Operational Creditor) Corporate Insolvency

Resolution Process having initiated by the Adjudicating Authority (National

Company Law Tribunal), New Delhi by impugned order dated 19th September,

2019 against 'M/s Pantel Technologies Pvt. Ltd.' (Corporate Debtor), same is

under challenge on the ground that there was a pre-existing dispute.

2. Learned counsel appearing on behalf of the Appellant - Shareholder

referred to email dated 30th September, 2016 and other documents to suggest

that faulty materials were supplied by the Operational Creditor, which reads as

follows:-

-2-

Company Appeal (AT) (Insolvency) No. 1090 of 2019 -3-

3. On the other hand according to learned counsel appearing on behalf of the

Respondent (Operational Creditor) by Letter of Guarantee dated 14th February,

2017, the Corporate Debtor confirmed payment without any objection and delay,

which is as follows:-

Company Appeal (AT) (Insolvency) No. 1090 of 2019 -4-

4. Reliance has also been placed by learned counsel for the Respondent on

Letter dated 10th July, 2017 to support that the Corporate Debtor was ready to

pay the dues, as extracted below:-

Company Appeal (AT) (Insolvency) No. 1090 of 2019 -5-

5. Another email dated 18th July, 2017 has been cited by learned counsel for

the Respondent, which is as follows:-

Company Appeal (AT) (Insolvency) No. 1090 of 2019 -6-

6. From the record we find that the demand notice under Section 8(1) was

issued by the Operational Creditor on 10th June, 2017, the email dated 30th

September, 2016 (as quoted above) is much prior to demand notice, which shows

that quality material was not supplied and it was substandard. Though by letter

dated 14th February, 2017, the Corporate Debtor has said that they will make

payment but letter dated 10th July, 2017 shows that sales proceeds could not be

realized by the Corporate Debtor because they faced lot of problems in the

material supplied by the Operational Creditor for bad quality and short supply.

7. Submission made by learned counsel for the Respondent - Operational

Creditor that the Corporate Debtor admitted the claim, cannot be adjudicated by

the Adjudicating Authority in an application under Section 9 of I&B Code as it

cannot decide the claim or counter claim being not Court of competent

jurisdiction. It is required to be seen that prior to issuance of demand notice

under Section 8(1) is there any dispute.

8. In the present case there being a pre-existing dispute relating to quality of

product supplied by the Operational Creditor referred in the email dated 30th

September, 2016, the Adjudicating Authority without deciding the issue whether

it was accepted to pay the amount or not is not competent to admit application

under Section 9, there being a pre-existing dispute.

Company Appeal (AT) (Insolvency) No. 1090 of 2019 -7-

9. For the reason aforesaid we set aside the impugned order dated 19th

September, 2019 and dismiss the application under Section 9 filed by the

Respondent - Operational Creditor. The Corporate Debtor is released from the

rigour of Corporate Insolvency Resolution Process and will function through its

Promoters and Directors. The Interim Resolution Professional will hand over the

assets and records to the Promoter/ Directors immediately. The case is remitted

to the Adjudicating Authority to decide the fee and cost incurred by the Interim

Resolution Professional and to decide about the person who will pay the amount,

preferably within three weeks. The appeal is allowed with aforesaid observations

and directions. No costs.

[Justice S. J. Mukhopadhaya] Chairperson

[Justice Bansi Lal Bhat] Member (Judicial) am/gc

Company Appeal (AT) (Insolvency) No. 1090 of 2019