Pre-existing dispute bars Section 9 insolvency admission where transit loss claims arose before the demand notice.

A Section 9 insolvency petition was barred where the record disclosed a genuine pre-existing dispute over loss and damage in transit and the extent of liability under the logistics agreement and addendum. Prior communications, certificates of fact and emails showed that the dispute arose before the demand notice, so it was not a manufactured objection raised later. The adjudicating authority is not required to examine the contractual merits of competing claims at the admission stage. The application was therefore not maintainable and was rejected.

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Issues: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016 was maintainable in the presence of a pre-existing dispute regarding loss and damage in transit and the liability arising from the logistics agreement and addendum.

Analysis: The parties had entered into a principal logistics agreement, later modified by an addendum dealing specifically with loss and damage during transit, issuance of certificates of fact, and the extent of liability. The record showed repeated prior communications, certificates of fact, and emails relating to loss or damage of consignments long before the demand notice. The dispute was therefore not a later or manufactured objection raised only after demand. In proceedings under Section 9, the existence of a genuine dispute that pre-dates the demand notice is sufficient to bar admission, and the adjudicating authority is not required to decide the contractual merits of competing claims.

Conclusion: The dispute was held to be pre-existing and genuine. The Section 9 application was not maintainable and was rejected.

Final Conclusion: The insolvency petition could not proceed because the record disclosed a real pre-existing dispute between the parties, falling within the bar against admission of a Section 9 application.

Ratio Decidendi: A Section 9 application under the Insolvency and Bankruptcy Code, 2016 must be rejected where the record shows a genuine pre-existing dispute arising before the demand notice, and the adjudicating authority cannot enter into contractual merits to resolve such dispute.

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