TaxTMI 
TaxTMI 
2019 (6) TMI 1488
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....r, was incorporated on April 22, 1970 having its registered office situated at The Indure House, Greater Kailash-Part II, New Delhi-110 048. Since the registered office of the respondent-corporate debtor is in New Delhi, this Tribunal having territorial jurisdiction over the NCT of Delhi is the Adjudicating Authority in relation to the prayer for initiation of the corporate insolvency resolution process in respect of the respondent-corporate debtor under sub-section (1) of section 60 of the Code. 3. It is the case of the applicant that it entered into two contracts on May 24, 2012 with the respondent pursuant to which the applicant placed two purchase orders on the respondent-company. 4. It is stated that the total consideration for the work under the supply contract was Rs. 32,42,78,970 and the total consideration for work under the service contract was Rs. 2,15,00,000. 5. It is contended in the application that the applicant satisfactorily fulfilled its obligation under both the contracts and raised 73 invoices totalling to Rs. 34,72,35,271 out of which 16 invoices totalling to Rs. 2,25,82,259 remained unpaid by the respondent along with interest of Rs. 97,86,723 as per the te....
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....of the respondent against the petitioner are to the tune of Rs. 5,01,67,062.05 because of which final bills in respect of the contract could not be settled. 14. It is further stated that the applicant has failed to complete the commissioning, trial operation and guarantee testing as per the terms of contracts and accordingly no taking over certificate has been issued by the respondent to the applicant on account of such breaches committed by the applicant. The respondent has also raised objection regarding price escalation. It is pointed out that no invoices have been raised by the applicant in respect of commissioning, guarantee testing, trail operations, etc., which shows that the applicant has abandoned its work and is liable to pay liquidated damages to the respondent. 15. We have heard learned counsels for the parties and have perused the case records. 16. The statutory provisions of section 9(5)(ii)(d) of the Code mandates that the Adjudicating Authority shall reject the application if notice of dispute has been received by the operational creditor. Section 9(5)(ii)(d) refers to the notice of an existing dispute that has been received, as it has to be read with section 8(2....
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.... : "(6) 'dispute' includes a suit or arbitration proceedings relating to- (a) the existence of the amount of debt ; (b) the quality of goods or service ; or (c) the breach of a representation or warranty." 21. It is no longer res integra that the definition of dispute is inclusive and not exhaustive. Dispute has been given wide meaning so as to cover all disputes on debt, default, etc. and not to be limited to only pending suit or a record of a pending arbitration. 22. Needless to say, that it is always open to the "corporate debtor" to take the plea of "existence of dispute" before the Adjudicating Authority, which alone can be a ground to reject the application filed under section 9 of the Code. 23. Once there is "existence of dispute" prior to issuance of notice under section 8, the petition under section 9 preferred by the operational creditor shall not be maintainable. 24. Admittedly, the respondent has relied upon its earlier reply issued on March 31, 2018 under section 8(2) of the Code bringing to the notice of the petitioner the existence of a dispute in respect of the claimed operational debt. 25. Even if no reply to the later demand notice was given, ....
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....reserves its issue an appropriate notice up on M/s. Sandvik for the recovery of its claim. Besides you have not revalidated the advance payment bank guarantees as provided in terms of the contract in spite of our repeated requests and follow-ups. We have already lodged our conditional claim to the bank and during last visit of your representative, we had advised him to furnish extension of the bank guarantee. However, the extension advice have not been received till date. Consequently, we are sending a request to the issuing bank for sending us the proceeds against the bank guarantee which have not extended by you till date. Further please note that the notice sent by you is not a proper notice under the provisions of the IBC, 2016 and hence it not maintainable. In view of the above you are hereby advised to withdraw the present notice as per claims as mentioned therewith are not payable by Indure, and have been raised against the terms of the contract. The present reply is being issued without prejudice to the right of the Indure Pvt. Ltd. Available to it under law and under the contract. Thanking you, Yours Sincerely, For the Indure Pvt. Ltd. Sd/- Y. A. Ismail. ....
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....rial to consider who will succeed. Tribunal will not examine the merits of the dispute other than to see if there is in fact exists a real dispute having some substance. 31. The respondent has placed its ledger account on record in support of alleged claims of the respondent against the petitioner. In the face of claims and counter claims respectively projected by the parties ; there is confusion on the actual amount of default. The various correspondences placed on record show that dispute was not raised for the first time to evade liability, but certainly pre-existed much prior to the issuance of notice under section 8 of the Code. There are several allegations like delay and laches in execution of contract, no completion certificate issued and poor performance, etc. Claims and counter claims are placed and relied upon. What emerges from the records is that there is a plausible dispute between the parties in regard to execution of the contract. 32. These are complex matters and the claims of both sides' prima facie suggest the need for elaborate enquiry. Once there is material to believe that dispute exists, it is right to have the matter tried out before the axe, in the fo....