Pre-existing dispute defeats Section 9 insolvency admission where operational debt and material facts are genuinely contested.

A Section 9 Insolvency and Bankruptcy Code application failed because the materials showed a pre-existing dispute over the claimed operational debt. Continuing litigation on the underlying dues, including challenges to the determination and the blacklisting of the operational creditor, established that the claim was not an undisputed debt. The reply to the demand notice itself referred to the dispute, and the Tribunal also found suppression of material facts, including pending writ proceedings and the dispute over calculation of dues. As the statutory threshold for admission under Section 9 was not met, the application was rejected.

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Issues: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016 was liable to be admitted in view of the alleged pre-existing dispute and suppression of material facts.

Analysis: The record showed continuing litigation between the parties concerning the dues claimed, including proceedings challenging the underlying determination and the blacklisting of the operational creditor. The reply to the demand notice itself referred to the dispute, and the materials placed before the Tribunal indicated that the controversy was not a simple case of an undisputed operational debt. The Tribunal also noted that the applicant had suppressed material facts relating to the pending writ proceedings and the dispute over the calculation of dues. On this basis, the statutory threshold for admission under Section 9 was not satisfied.

Conclusion: The application was not admissible and was rejected against the applicant.

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