Tirupati Starch & Chemicals Limited vs Industrial Enviro And Engineering ...

IN THE MATTER OF: Tirupati Starch and Chemicals Ltd. ...Appellant

Versus Industrial Enviro & Engineering Services Pvt. Ltd. ...Respondent

Present: For Appellant: PCS Pratik Tripathi For Respondent:

ORDER

(Virtual Mode)

13.07.2022: Heard Learned Counsel for the Appellant.

2. This Appeal has been filed against the Order dated 25th April, 2022 by

which Order, the Adjudicating Authority has rejected the Application filed under

Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC in short). The

Appellant-Operational Creditor had issued a Purchase Order dated 26th May,

2018 to the Corporate Debtor for supply and installation of 'West Water Recycle

System'. As per the Purchase Order, the amounts were paid to the Corporate

Debtor and the Corporate Debtor has also delivered the 'West Water Recycling

Plant' on the site of the Applicant vide different delivery challans and

subsequently the Appellant claims to have cancelled the entire Purchase Order

by Email dated 05.10.2020. Subsequent to the cancellation of the entire 2

Purchase Order, the Appellant has filed Section 9 Application of IBC claiming

refund of the entire amount paid and alleged the default of not refund of the

amount. The notice was issued in the Section 9 Application. Corporate Debtor

appeared and has opposed the Application and Reply was filed stating that work

was performed by the Corporate Debtor as per the Order. The claim of the

Operational Creditor was denied. The Adjudicating Authority after hearing the

parties took the view that there has been a genuine dispute raised by the

Corporate Debtor for which several materials were on the record one of the Email

dated 23.12.2019 i.e much before the Email cancelling the Purchase Order was

quoted in Paragraph 15. On the basis of materials on record, the Adjudicating

Authority was satisfied that there was genuine pre-existing dispute hence the

Application was rejected.

3. Learned Counsel for the Appellant submitted that Corporate Debtor has

never challenged the Cancellation of Purchase Order and has not even replied

the Demand Notice. The Adjudicating Authority has noticed in the Impugned

Order that Corporate Debtor has filed the Affidavit in Reply before the

Adjudicating Authority and has taken pleas which has been noticed by the

Adjudicating Authority.

4. We are of the view that there were substantial materials on record to

indicate that there was genuine pre-existing dispute raised by the Corporate

Debtor. The submission of the Appellant that no objection was raised by the

Corporate Debtor to the Cancellation of the Purchase Order is without any

Company Appeal (AT) Ins. No. 742 of 2022 3

substance. The Adjudicating Authority has rightly rejected the Application under

Section 9 of IBC on account of pre-existing dispute.

The Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Justice M. Satyanarayana Murthy] Member (Judicial)

[Mr. Barun Mitra] Member (Technical)

Basant/nn

Company Appeal (AT) Ins. No. 742 of 2022