The NCLAT dismissed the Section 9 application filed by the...

The NCLAT dismissed the Section 9 application filed by the Operational Creditor due to the existence of a pre-existing dispute concerning the amount payable by the Corporate Debtor. The Operational Creditor admitted only eight out of seventeen credit notes issued for special quantity discounts, evidencing a commercial arrangement between the parties. The Corporate Debtor's ledger reflected an outstanding balance of Rs. 22,56,833/-, which it was willing to pay, but the Operational Creditor refused acceptance. The Tribunal held that the dispute was not a mere feeble legal argument but a plausible contention requiring investigation, thereby negating the application under Section 9. The Adjudicating Authority correctly refrained from detailed inquiry and upheld the rejection of the application. The Corporate Debtor was directed to remit the admitted outstanding amount within two weeks upon receipt of bank details from the Operational Creditor.

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