TaxTMI 
TaxTMI 
2020 (2) TMI 915
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....nal Creditor is engaged in the business of mining, manufacturing and supply of building materials known as aggregates. Further, the Operational Creditor also has a Ready-Mix Concrete (RMC) plant at Khopoli, Maharashtra which it either operates on its own or lends it out to interested parties on lease/license basis. 2.(b) That the Corporate Debtor formerly known as Prism Cement Limited of which RMC (India) Division is one of the Divisions was established in the year 1958. Company and is registered at Registrar of Companies, Hyderabad. Its authorized share capital is Rs. 5,249,999,900/- and its paid-up capital is Rs. 5,033,565,700/-. It is involved in the business of manufacturing and sale of Ready-Mix Concrete in addition to various other business. 2.(c) That the Corporate Debtor came to know about the said plant of the Operational Creditor and it showed interest in operating the plant for its own business. In addition, the Corporate Debtor also showed interest in buying the aggregates for such operation. 2.(d) That with such objective the parties entered into an agreement for leasing of the plant and supply of the aggregates. However, the Corporate Debtor expressed its wis....
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....esented to the Respondent that the Operational Creditor was also a manufacturer of aggregate products, which is one of the raw materials required for manufacturing Ready-mix concrete. The Petitioner represented the Respondent that such aggregate products are sourced from the Petitioner's Quarry at Khopoli, Taluka Khalapur, District Raigad and the same is of VSI quality. The Petitioner further represented to the Respondent at the relevant time that if the Respondent agrees to take and operate the said plant and machineries on lease basis from the Petitioner for a lease period of 5 (Five) years, then in such event, the Petitioner shall supply the said aggregate products at fixed rates and at consistent quality to the Respondent without any deviation in rates for any of the reason. 3.(iii) It is stated that the Respondent believing all Petitioner's representations, assurances and believing that the Respondent shall be able to carry out their concern's business from the said plant for longer period of time on the assurances tendered by the Petitioner, the Respondent agreed to acquire the said plant and machineries from the Petitioner on monthly rent and at fixed price of....
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....al agreement inter alia recording the terms and conditions already agreed and recorded in the said MoU. 3.(vii) It is stated that the Respondent was left with no other alternative but to address the Petitioner a notice, dated 19th May, 2018, inter alia calling upon them to restore the possession of the said plant as well as to supply the aggregate as per the terms and conditions of the said MoU as well as to execute the formal agreement required by the Respondent for statutory compliances. The Respondent also called upon the Petitioner to compensate the Respondent for monetary loss of around Rs. 51 lakhs (Rupees Fifty One Lakhs) caused to the Respondent from 22nd February, 2018 till 18th May, 2018, and further to adjust the part of the said compensation towards Petitioner alleged dues. 3.(viii) It is stated that by way of its reply letter, dated 19.06.2018, the Respondent refuted all the baseless and unwarranted allegations of the Petitioner and called upon them to specifically perform the said MoU and to restore the possession as well as raw materials supply as per the agreed terms of MoU. The Respondent was further surprised to receive reply, dated 30th June, 2018, from the....
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....ure and that the Corporate Debtor wished to try out the arrangement on an experimental basis before entering into a final agreement. Further, on the issues raised (before signing the MoU) by the Operational Creditor, the Corporate Debtor gave various assurances that those issue will sorted out at the time of entering into a final agreement. 4.(I) It is stated that the Corporate Debtor has gone to great extent to distort the facts and present a case which is clearly not so. The Corporate Debtor has tried to show that the MoU is a final binding contract when in fact it is apparent to the contrary. The Parties had entered into an MoU only to lay down the understanding between the two parties. It was only on the insistence of the Corporate Debtor that it wanted to try the arrangement on an experimental basis before entering into a final agreement that the Operational Creditor allowed them to operate the plant at Khopoli. The Understanding that there will be a final agreement, to be entered into a later point of time, was apparent from the MoU itself. Further, various emails, (dated 18.12.2017 and 11.01.2018), from the Corporate Debtor asking Operations Creditor to enter into an agre....
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....orary nature of the MoU but also shows that it was an agreement to enter into an agreement. This later agreement was to be for a term of five-years after all the terms are finalized and not the MoU itself. It was only on the representation by the Corporate Debtor that all the terms will be finally agreed into a later agreement that the Operational Creditor entered into an MoU which was for a trial period to allow the Corporate Debtor to test the viability of the plant. 4.(VI) It is stated that the reliance placed by the Corporate Debtor on the ruling of the Hon'ble Supreme Court in Mobilox Innovations (P.) Ltd. v. Kriusa Software (P.) Ltd. (C.A.No. 9405 of 2017), is misplaced as the Hon'ble Supreme Court very clearly held that the defence of 'dispute' under IBC is not available where such dispute is frivolous, hypothetical or illusory. In the present case it is shown beyond doubt that the dispute is in fact frivolous and hypothetical 4.(VII) It is stated that the reliance placed by the Corporate Debtor on the ruling of the Hon'ble Supreme Court in Jai Beverages (P.) Ltd. v. State of J&K (Appeal (Civil) No. 7147 of 2004), is misplaced. The said ruling is ba....
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....udge, Senior Division, Panvel, District on the grounds of non-supply of aggregates by the Petitioner among other grounds there by resulting in huge monetary loss and damages and loss of reputation in the market. Further notices were exchanged between the Petitioner and Respondent in respect of the existing dispute on various issues pertaining to the MoU by way of various correspondence including the Petitioner's notice, dated 08.10.2018 and the Respondent's Reply notice dated 11.10.2018 and 12.10.2018 respectively. However, when the Petitioner was not obliging and agreeing to settle the above issues, the Respondent had no other option but to file a civil suit in Court of the Hon'ble Civil Judge, Senior Division, Panvel, District Raigad seeking specific reliefs and the same is currently pending before the Hon'ble Civil Court. Reiterating the above contentions, the counsel for the Respondent prayed to dismiss the present petition. 6. Heard submissions of both sides. Perused material and written submissions. 6.(1) It is a matter of a record that both the parties conducted themselves in accordance with the terms of MoU entered into on 08.05.2017 up to 02.02.201....
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....htra by the Corporate Debtor on 23.10.2018. 6.(6) It is pertinent to note here that the claim made by the Operational Creditor in the instant application pertains to the following: (a) Lease rent for land and machinery; and (b) Supply of aggregates by the Operational Creditor to the Corporate Debtor. 6.(7) It is seen from the copy of the civil suit filed by the Corporate Debtor that it seeks the following reliefs: i. To restore back to the Respondent, the possession of the rented premises forcefully taken by the Petitioner for which they have already paid Security Deposit of Rs. 8,50,000/- at the earliest; ii. To give due effect to the terms and conditions of the MoU and execute the Formal Agreement already submitted to the Petitioner by the Respondent; iii. To ensure that the supply of aggregate to the Respondent shall be of same quality and of fixed price as agreed under the said MoU; iv. To compensate the Respondent for the period they could not carry on their manufacturing business by an amount of Rs. 62,80,000/- (Rupees Sixty Two Lakhs and Eighty Thousand Only); v. To restrain the Petitioner from alienating t....