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of <h1>Tribunal Upholds Decision on Undervalued Transactions, Orders Payment to Corporate Debtor</h1> <h3>Technico Industries Ltd. Versus Debashis Nanda Liquidator of J.V. Srips Limited In the matter of J.V. Strips Limited (In Liquidation), Ashwani and Sons, Ilasakaa Steel Limited, Jindal Buildsys Ltd., Bharti Engineering Co., Design O Creations, GSD Components Pvt. Ltd., Jaity Steel Strips, Muk San Steels Pvt. Ltd., DRT Steels</h3> Technico Industries Ltd. Versus Debashis Nanda Liquidator of J.V. Srips Limited In the matter of J.V. Strips Limited (In Liquidation), Ashwani and Sons, ... Issues Involved:1. Whether the transactions between the Appellant and the Corporate Debtor were undervalued transactions.2. Whether the discounts given to the Appellant were in the ordinary course of business.3. Whether the Adjudicating Authority erred in directing the Appellant to make payment of Rs. 31,00,475.00 to the Corporate Debtor.Summary of Judgment:1. Undervalued Transactions:The Appellant challenged the Impugned Order dated 07.06.2022, which declared certain transactions with the Corporate Debtor as undervalued and directed the Appellant to pay Rs. 31,00,475.00. The Appellant argued that the transactions were part of a running account for raw materials supplied to the Corporate Debtor and that discounts were mutually agreed upon due to quality issues, processing costs, and rate differences.2. Ordinary Course of Business:The Appellant contended that the discounts were given in the ordinary course of business, citing a meeting on 03.04.2018 where these issues were discussed and resolved. The Respondent/Liquidator argued that these discounts were not in the ordinary course of business, as they were decided just ten days before the commencement of the Corporate Insolvency Resolution Process (CIRP) on 13.04.2018. The Liquidator maintained that these transactions were 'avoidable transactions' under Section 46(1)(i) of the Insolvency and Bankruptcy Code (IBC) and were undervalued as per Section 45(2)(b).3. Adjudicating Authority's Decision:The Tribunal examined the ledger accounts submitted by both parties. It found that the Corporate Debtor's ledger, which recorded the discounts given to the Appellant, was reliable. The Tribunal noted that the Appellant failed to provide contemporaneous documentation to support the claim that the discounts were part of the ordinary course of business. The Tribunal concluded that the discounts were given within the look-back period of one year, making them avoidable transactions under the IBC.Conclusion:The Tribunal upheld the Adjudicating Authority's decision, finding no error in the Impugned Order. The appeal was dismissed, and the Appellant was directed to pay Rs. 31,00,475.00 to the Corporate Debtor. No order as to costs was made.
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