AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (3) TMI 1523
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.... 12% to 21% per annum up till 14th September, 2018. 2. This Operational Creditor is one of the group Companies of Sojitz Group Companies, this group is a large Japanese general trading corporation engaged in a wide range of business globally, including buying, selling, importing, exporting, manufacturing and selling products as well as providing services. In 2015, one of its group companies namely, Sojitz Corporation (SJC) began exploring opportunities for business collaboration and joint investment with the Corporate Debtor. In furtherance of it, SJC entered into a non-binding Memorandum-Strategic Alliance (SBAA) dated 23.06.2016 with the Corporate Debtor for a limited period of one year and this expired in June, 2017. It was for exploration of opportunities and collaboration for trading and joint investment. Besides this, SJC and the Corporate Debtor also entered into two Confidentiality Agreements dated 27.03.2015 and 07.04.2016 (collectively called as "SJC Memoranda"), to protect any confidential/proprietary information disclosed among them. 3. Why this background is mentioned here is because the Corporate Debtor tried to interpose these agreements into the claim transaction ....
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....ly of Barite Lumps, basing on the Purchase Order given by the Corporate Debtor, the Operational Creditor from time to time invoiced the supplies received by the Corporate Debtor against the remittance of money from the Corporate Debtor. This claim transaction is altogether separate and independent transaction proceeded on the separate Letter of Credit given by the Operational Creditor. In this process, some commission would come to the Operational Creditor that is reflected in the e-mail correspondence between the Operational Creditor and the Corporate Debtor from July 11, 2017 to July 13, 2017 [Annexure-II(E)]. 6. As per this claim transaction, the Corporate Debtor on 14.07.2017 raised Purchase Order for supply of 38,000 MTs 'A' Grade Barite Lumps with 4.27 specific gravity costing around Rs. 24,89,53,333. In pursuance thereof, the Operational Creditor raised tax invoices from 27.07.2017 to 31.08.2017. 7. Soon thereafter in the month of December, 2017, when the Operational Creditor on 19.12.2017 put it to the Corporate Debtor that they had not yet received the payment, on the same day, the Corporate Debtor reciprocated saying it was processing the payment in 2-3 days'....
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....porate Debtor's established facilities in Saudi Arabia. So to help out SJC, the Corporate Debtor had supplied Barites directly to AI Alia on assurances given by Sojitz for trade financing of this transaction. Accordingly, three shipments weighing 38,000 MTs were released by the Corporate Debtor to AI Alia from July, 2016 to October, 2016. With this defence, the Corporate Debtor, for the first time has attempted set out dispute challenging the very nature of the transaction itself. By saying so, the Corporate Debtor Counsel has sought for dismissal of this Company Petition on the ground that this claim is hit by non-existence of debt. 13. On perusal of these facts placed by either side, it is evident that it is a transaction that has happened in between the Operational Creditor and the Corporate Debtor in the months of July and August, 2017. Before entering into this transaction, there is a clear cut correspondence between the Operational Creditor and the Corporate Debtor making it clear that it is a transaction for supply of 38,000 MTs of Barite Lumps from APMDC on the monies supplied by the Operational Creditor. In fact, though there is an agreement between APMDC and the Corp....
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.... OREN needs this LC to be opened in this week itself. Hence we need concurrence of Sojitz as quickly as possible to prepare necessary documents for LC opening. The approximate quantity of Barites to be procured is 38000 MT. Looking forward. Thanks & regards R. Soundararajan Director" 16. It is also imperative to look into the reply that has come from the Operational Creditor which is as follows: "From: karita.hiroki [mailto:[email protected]] Sent: Tuesday, July 11, 2017 7:05 AM To: RS RAJAM Cc: aritomo.shinji; 'Irfan'; [email protected]; [email protected]; [email protected];[email protected] Subject: RE: Finance arrangement for Barite procurements Dear Mr. Rajan, Thank you for your suggestion. Let me make sure some points. (1) We understand that normal payment term between you and APMDC is 100% payment in advance (Mr. Irfan also mentioned it) But this time, payment term is 90days after delivery. What is the difference of the background? (2) Will you let us know unit price from APMDC? (3) 38000 MT is for one time transaction ? (4) Will you have this procurement scheme monthly or quarterly? We would like to know the fre....
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....thin 90 days from the day the material was delivered to the Corporate Debtor, the money was remitted to the account of APMDC from the LC account. After the Operational Creditor having furnished all this material reflecting the Operational Creditor paying money to APMDC for assignment of the material, thereafter the Corporate Debtor lifting that material on behalf of the Operational Creditor by placing purchase order upon the creditor, it can easily be said that material was routed to the Corporate Debtor through the Operational Creditor because the right of sale of 38,000MTs of barites has been conferred upon the operational creditor so as to draw out LC limit from the Operational Creditor. 19. As to the understanding between the Operational Creditor and the Corporate Debtor, this Corporate Debtor placed Purchase Order for the material and on supply of such material, the Operational Creditor raised invoices against the Corporate Debtor, subsequent thereof, the Corporate Debtor confirmed the claim amount on 20.02.2018, not only that, the corporate debtor made promises that it would soon pay the dues to the operational creditor, indeed the Corporate Debtor made part payment of Rs. 3....
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....onal Creditor. 21. Therefore, we are of view that what all agreements the Corporate Debtor entered into with group companies and correspondence in respect to other transactions will no way cast any doubt over the existence of debt or default. In view thereof, the material subsequently set out by this Corporate Debtor pales into insignificance as against the proof of existence of debt and default against the Corporate Debtor established by the Operational Creditor. 22. On looking at the address of the Interim Resolution Professional Mr. Subhash Kumar Kundra located at Delhi, we are of the view that when the corporate debtor is located at Chennai, it is quite obvious that Financial Creditors of this company must be located at Chennai, in this background it is always in fitness if local professional is appointed, instead of airlifting a person from Delhi, which will be taxing to the stressed company and there is every chance for delay to happen, hence we have rejected the name suggested by the Operational Creditor. 23. Accordingly, for the reasons aforestated, this Company Petition is hereby admitted by appointing Mrs. Jayashree S Iyer (Reg. No. IBBI/IPA-002/IP-N00741/2018-2019/122....