Tribunal Upholds Adjudicating Authority's Order on Section 9 Application

The Tribunal dismissed the Appeal, upholding the Adjudicating Authority's order admitting the Section 9 Application. The Tribunal found that the Application was filed within the limitation period, the statutory Demand Notice was duly served, and the Operational Creditor had provided sufficient evidence to establish the debt and default. The Tribunal also affirmed that the IBC could be invoked for executing an Arbitral Award.

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Issues Involved:
1. Timeliness of the Section 9 Application.
2. Service of Statutory Demand Notice.
3. Attachment of Invoice to Demand Notice.
4. Service of Notice of Company Petition.
5. Limitation Period for Filing the Claim.
6. Execution of Arbitral Award through IBC.

Issue-wise Detailed Analysis:

1. Timeliness of the Section 9 Application
The Appellant contended that the Section 9 Application was filed belatedly as the operational debt dated back to 05.12.2002. However, the Tribunal noted that the debt was crystallized by an Arbitral Award dated 30.05.2013, which was contested by the Respondent No. 2 and subsequently dismissed by the XXIV Additional Chief Judge, City Court, Hyderabad on 27.01.2016. The Tribunal held that the three-year limitation period as per Article 137 of the Limitation Act, 1963, would commence from 27.04.2016 (90 days post-dismissal), making the Section 9 Application filed on 03.04.2019 within the limitation period.

2. Service of Statutory Demand Notice
The Appellant argued that the statutory Demand Notice was not delivered to the Corporate Debtor. The Respondent No. 1 provided proof of service, including postal receipts and tracking information. The Tribunal found that the notice was served to the Corporate Debtor's registered office and subsequently to the updated address as per MCA records, fulfilling the requirement under Section 8(1) of IBC.

3. Attachment of Invoice to Demand Notice
The Appellant claimed that the Operational Creditor did not attach a copy of the invoice to the Demand Notice. The Tribunal observed that the Operational Creditor filed Form-5, including the Arbitral Award and other documentary proofs supporting the claim. The Tribunal found that the Operational Creditor had provided sufficient evidence to establish the debt and default by the Corporate Debtor.

4. Service of Notice of Company Petition
The Appellant contended that the notice of the Company Petition was not served, including via email. The Tribunal reviewed the order sheets and found that multiple attempts were made to serve the notice, including to the new address and email. The Tribunal noted that despite these efforts, the Corporate Debtor did not appear or contest the claim, leading to the conclusion that the service was sufficient.

5. Limitation Period for Filing the Claim
The Appellant argued that the claim was time-barred. The Tribunal referenced the Supreme Court judgment in "B.K. Educational Services Pvt. Ltd. Vs. Parag Gupta & Associates," which stated that the limitation period for filing applications under Sections 7 and 9 of IBC is three years from the date of default. The Tribunal concluded that the claim was within the limitation period, considering the timeline of the Arbitral Award and subsequent legal proceedings.

6. Execution of Arbitral Award through IBC
The Appellant argued that IBC cannot be invoked for executing an Arbitral Award. The Tribunal referred to the definition of "creditor" under Section 3(10) of IBC, which includes a decree-holder. The Tribunal held that the Operational Creditor, as a decree-holder, was entitled to invoke IBC for the unpaid debt crystallized by the Arbitral Award. The Tribunal cited the Supreme Court judgment in "K. Kishan Vs. Vijay Nirman Company Private Limited," which supports the view that an operational debt remains disputed until the final adjudication under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996.

Conclusion
The Tribunal dismissed the Appeal, upholding the Adjudicating Authority's order admitting the Section 9 Application. The Tribunal found that the Application was filed within the limitation period, the statutory Demand Notice was duly served, and the Operational Creditor had provided sufficient evidence to establish the debt and default. The Tribunal also affirmed that the IBC could be invoked for executing an Arbitral Award.

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