Purchase orders as separate contracts; Insolvency Code application admitted; moratorium declared; IRP appointed.

The Tribunal found that the purchase orders in question were separate contracts, each giving rise to independent causes of action, with no pre-existing dispute. The application under section 9 of the Insolvency and Bankruptcy Code was admitted, declaring a moratorium and appointing an Interim Resolution Professional. The Operational Creditor was directed to deposit funds for expenses, and further procedural steps were outlined. The management of the Corporate Debtor was vested in the IRP during the Corporate Insolvency Resolution Process.

---

---

Issues Involved:
1. Is there any pre-existing disputeRs.

Issue-wise Detailed Analysis:

1. Is there any Pre-existing disputeRs.

The Tribunal examined the submissions from both the Operational Creditor and the Corporate Debtor. The Operational Creditor's claim was based on a purchase order dated 25 September 2017, for the supply of CS Bogies, which was to be paid through Letters of Credit (LoC). The dispute arose when the Corporate Debtor's bank refused to honor the LoC for the second tranche of 44 bogies due to discrepancies. The Corporate Debtor countered that this proceeding was a response to a separate case they had filed against the Operational Creditor in the NCLT Mumbai Bench, involving different purchase orders and transactions.

The Tribunal noted that the application before the NCLT Mumbai Bench was related to non-supplies of bogies under different purchase orders (CIMM/17-18/001617 and CIMM/17-18/001618), which were unrelated to the current transaction. The Corporate Debtor's claim of a larger counterclaim and set-off was based on these separate transactions. The Tribunal referenced the Supreme Court judgment in Union of India v. Karam Chand Thapar & Bros., which clarified that set-off claims must arise from the same transaction to be considered equitable.

The Tribunal concluded that the purchase orders in question were separate contracts, each giving rise to independent causes of action. Therefore, the claim related to purchase order CIMM/17-18/0000568 was distinct and had no pre-existing dispute. The Tribunal found that the present petition by the Operational Creditor was complete and established that the Corporate Debtor was in default of a debt due and payable, exceeding the minimum amount stipulated under section 4 (1) of the Code.

Order:

1. The application CP (IB) No. 27/KB/2019 filed by Simplex Castings Limited under section 9 of the Insolvency and Bankruptcy Code, 2016, is admitted.
2. A moratorium under section 14 of the IBC is declared, effective from the date of the order until the completion of the CIRP or the approval of a resolution plan.
3. Public announcement of the CIRP shall be made immediately.
4. Mr. Sri Ram Mittal is appointed as the Interim Resolution Professional (IRP).
5. The management of the Corporate Debtor shall vest in the IRP during the CIRP period.
6. The Operational Creditor shall deposit Rs.3,00,000/- with the IRP to meet the expenses of issuing public notice and inviting claims.
7. The Court Officer is directed to communicate this Order to the Operational Creditor, the Corporate Debtor, and the IRP by Speed Post and email immediately.
8. The Operational Creditor shall serve a copy of this Order on the IRP and the Registrar of Companies, West Bengal, Kolkata, who shall update the Master Data of the Corporate Debtor and send a compliance report.
9. The case is scheduled to come up on 30.12.2022 for filing the periodical report.

The order was pronounced on 01st November 2022.

---