TaxTMI 
TaxTMI 
2020 (9) TMI 438
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....id Ocean Services Private Limited. The Corporate Debtor is, inter alia, engaged in marketing of gift cards, managing digital programmes for corporates, etc. 3. The respondent- corporate debtor is a private limited company incorporated under the provisions of the Companies Act, 1956 and has its registered office mentioned in the cause title. It is engaged in the business of marketing gift cards, managing digital programmes for corporate entities. 4. AVERMENTS MADE IN THE PETITION: 4.1 The Corporate Debtor has approached the petitioner to market their product "Zaggle Kuber Cards" and insisted 100% advance payment on the cards and offered a huge discount of 3 - 5 % on the value of the cards to be sold to customers at large. On 15.09.2017 an agreement was entered into between the parties, by which the respondent confirmed appointment of the petitioner as seller of "Zaggle Kuber Cards". 4.2 The petitioner made several purchases by making 100% advance payment through Bank and the respondent has issued Invoices. On receipt of payments the respondent would deliver and activate the cards with their respective values. The petitioner would then sell the cards to customers. 4.3 The petiti....
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....at they have released the above amount against blocked cards issued by Corporate Debtor. 5.5 It is averred that the above amount was released qua blocked cards and it has no baring to the amount claimed by the Operational Creditor worth Rs. 6,11,10,000/- for purchase of 6300 cards with RBL Bank. 5.6 In view of the above subsequent developments, the petitioner craves leave of the Tribunal to grant permission to restrict its claim to an amount of Rs. 6,11,10,000/- along with interest at the rate of 18% per annum on the basis of settlement arrived at between the parties. 6. COUNTER DATED 23.08.2019 FILED BY THE RESPONDENT/CORPORATE DEBTOR. 6.1 It is averred in para 5.7 of the Counter that the petitioner was incorporated on 16.08.2017 who decided to engaged with the respondent in active business. Accordingly respondent has appointed the petitioner vide Agreement dated 15.09.2017 (ANNEXURE A-2 to the Counter) as Channel Partner for marketing Gift Cards. 6.2 It is averred in para 5.8 of the Counter that the respondent provided a discount of 1 - 2 % to its channel partners including the petitioner, to sell Gift Cards, as purchased from respondent, to corporates. Copies of Invoices ra....
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....#39;A-10' to the Counter) under section 8 of I&B Code. The petitioner had also issued Legal Notices dated 09.10.2018 (for ' 6,11,10,000/-) and dated 29.03.2019 ( for ' 10,28,69,811/-). The respondent issued reply notice dated 01.04.2019 (ANNEXURE 'A-11' to the Counter). The respondent issued reply dated 23.10.2018 to the petitioner's notice dated 09.10.2018. 6.9 It is averred in paras 5.26, 5.27 and 5.28 of the Counter that assuming that the claim of the petitioner for ' 4,17,59,811/- and for ' 6,11,10,000/- is true, even then the petitioner did not raise the issue in its first Notice dated 09.10.2018. The petitioner had merely stated about the claim of ' 6,11,10,000/- in its notice dated 09.10.2018. 6.10 It is averred in para 5.33 of the Counter that at the behest of the petitioner, one of its dealer/customer filed a fraudulent FIR before SHO, Karnal and the officer registering such FIR has been suspended on the next day on charges of corruption. 6.11 In paras 6.1.1, 6.1.2 and 6.1.3 of the Counter the respondent has furnished detail of communications/complaints/proceedings between the petitioner and the respondent in chronological order comme....
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....of the Counter the respondent relied on decision of the Hon'ble NCLAT in PRADEEP KUMAR MUDNRA Vs. CIL SECURITIES LIMITED, rendered in Company Appeal (AT) (Insolvency) No. 89 of 2019, and contended that the petition is based on false information and thus the petitioner is liable to be penalized and the petition be dismissed. 6.16 It is averred in paras 6.4.1 and 6.4.2 of the Counter that the respondent has sent E-mail dated 08.10.2018 to the petitioner about adjustment of ' 6,11,10,000/- by the petitioner against the amount of ' 36 crores payable by the petitioner to the respondent, by which the respondent has established pre-existing dispute. However, the petitioner suppressed the vital facts. 6.17 In para 6.4.3 of the Counter, on the point of suppressions of facts, the respondent relied on decision of the Hon'ble Supreme Court in OSWAL FATS AND OILS LTD Vs. ADDITIONAL COMMISSIONER (ADMINISTRATION), BAREILLY DIVISION, BARILLY AND OTHERS, (2010) 4 SCC 728. 6.18 In para 6.4.4 of the Counter, on question of tainted hands, the respondent relied on decision of the Hon'ble Supreme Court in RAMJAS FOUNDATION Vs. UNION OF INDIA, (2010) 14 SCC 38. 6.19 In para 6.4.5 ....
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.... Operational Creditor by leading vital evidence annexed with the rejoinder. The Corporate Debtor insisted 100% advance payment on cards and offered a huge discount of 3 - 5% on the value of cards to be sold to corporates at large. Said agreement dated 15.09.2017 was entered into to the said effect. The Operational Creditor reiterates the submissions made in the Preliminary Objections about handful of invoices, which are false and fabricated and craves leave to prove veracity of the same at final hearing. 7.4 In para 5.8 and 5.9 of the Rejoinder the Operational Creditor concedes that 100% advance payments have been made from the beginning and the same continued during the course of business. It is however, averred such payments were made on an assurance of providing heavy discounts. The Corporate Debtor having received 100% payments from Operational Creditor failed to activate the cards and had blocked the cards. 7.5 In para 5.10 of the Rejoinder the averments made in the preceding paras were reiterated to emphasize about 100% advance payments were made to Corporate Debtor against the offer of 3 - 5% discount on the value of cards to be sold to corporates at large; about concealme....
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....egal proceedings. Said FIR has been challenged before the Hon'ble High Court of Telangana. The Hon'ble High Court has dispensed with presence of representatives of Operational Creditor vide order dated 29.08.2019 (ANNEXURE 'D'). 7.10 In para 5.18 of the Rejoinder it is alleged that Corporate Debtor has suppressed issuance of Legal Notice dated 15.10.2019 by the Operational Creditor calling upon Corporate Debtor to unblock the cards. 7.11 In para 5.21 of the Rejoinder it is alleged that the Corporate Debtor has deliberately concealed about Legal Notice dated 15.10.2019 issued to Corporate Debtor by Operational Creditor claiming a sum of Rs. 6,02,59,811/-. Admitting their liability the Corporate Debtor had unblocked cards worth Rs. 1,85,00,000/- leaving behind cards worth Rs. 4,17,59,811/-. 7.12 In para 6.1.1 of the Rejoinder it is averred that not commenting on Legal Notice dated 15.10.2018 issued by Operational Creditor it amounts to admission of their liability towards operational creditor. In sub-clause (2) of this para it is averred that Legal Notice dated 09.10.2018 issued by Operational Creditor is admitted. Separate Legal Notice dated 15.10.2018 has been is....
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....dent denied the allegations leveled in its Legal Notices. The amounts claimed by the Operational Creditor including sum of Rs. 4,17,59,811/- as claimed vide Legal Notice dated 15.10.2018 by the Operational Creditor are illusory. On the contrary, the petitioner is liable to pay a sum of Rs. 29,99,27,454/- to the respondent. The respondent has consistently been contending ever since initiation of dispute between the petitioner and the respondent, viz. September 2018, viz. six months prior to issuance of Demand Notice dated 29.03.2019 by the petitioner that sum of Rs. 29,99,27,454/- is due and payable by the petitioner to the respondent after due deduction of a sum of Rs. 6,11,10,000/-. 8.2 It is averred in para 8.5 of the Additional Counter that an amount of Rs. 4,17,59,811/- towards blocking of cards is due and payable by the respondent. It is averred that for want of KYC details of the petitioner and its customers said cards were blocked by banker. The respondent had nothing to do with such blockage. 8.3 It is averred in paras 8.7, 8.8 and 8.9 of the Additional Counter that the allegation of suppression of Notice dated 15.10.2018 by the respondent is untenable as the petitioner i....
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.... rejoinder. It is averred in para 9.1 that the respondent commenced its business operations from 2011 and has gradually developed its business, whereas the petitioner incorporated its company only in August 2017. Around the same time business agreement was entered into by the petitioner with the respondent. 8.11 In paras 9.2 and 9.3 of the Additional Counter it is averred that the respondent has always provided discounts from 1% to 2% to all its channel partners. However, the petitioner claimed higher discounts based on forged and fabricated invoices, ranging from 3% to 5%. In fact, Annexure-3 filed with the petition by the petitioner shows discounts ranging between 1% to 2%. 8.12 In para 9.4 of the Additional Counter it is averred that if the respondent offered huge discounts at 3 to 5%, as claimed by the petitioner, then why did the petitioner not claim discounts at the same higher rates from October 2017, and why claimed only from April 2018. It is averred that the petitioner wants to enrich itself by fabricated invoices. 8.13 In paras 9.5 and 9.6 of the Additional Counter it is averred that on one hand the petitioner raises fabricated invoices and on the other it relies on w....
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....tional Counter it is averred that both the petitioner as well as respondent admit the complaints/proceedings mentioned in clauses (a) to (e) in this para. 8.21 In para 9.21 of the Additional Counter it is averred that legal notices issued by the petitioner on various dates, proceedings initiated before various forums as mentioned in clauses (a) to (i) in this para are not at all required but for illusory, spurious and imaginary disputes conceived by the petitioner. 8.22 In para 9.24 of the Additional Counter it is averred that if there is no meaning of respondent's response dated 23.10.2018 to the petitioner's legal notices dated 09.10.2018 and 15.10.2018 as contended by the petitioner, then there ought to be no meaning to the legal notices issued by the petitioner as well. 8.23 In para 9.25 of the Additional Counter it is averred in response to the petitioner's contention that the claims of the respondent are time-barred, that the respondent started demanding payments and adjusted Rs. 6,11,10,000/- received from the petitioner on 04.10.2018 and turned around the false claims. 8.24 In para 9.26 of the Additional Counter it is averred that the respondent in good fait....
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....unter the respondent encloses ledger statement of the respondent pertaining to the transactions conducted between the petitioner and the respondent from October 2017 to October 2018 showing amounts received by petitioner is annexed at ANNEXURE 'A-18'. The respondent encloses copies of anticipatory bail application and quashing petition filed by the petitioner at ANNEXURE 'A-19' to this Additional Counter. The respondent also encloses copy of Agreement executed by Operational Creditor with RBL Bank in relation to its claim against the Corporate Debtor at ANNEXURE 'A-20' to the Additional Counter. 9. COUNTER DATED 19.11.2019 FILED BY THE RESPONDENT/CORPORATE DEBTOR. 9.1 It is averred on page 2 of the Counter that the Corporate Debtor has filed IA No. 851 of 2019 seeking original invoices from the petitioner alleged to have been issued by the Corporate Debtor. The Tribunal allowed the said IA directing the petitioner to submit such original invoices. The petitioner instead of complying with the directions of the Tribunal had preferred to file Affidavit for Amendment for reduction of the claim. This Counter essentially rebuts the averments made in the said Aff....
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....without devolving upon the terms of settlement. The respondent contends that at no point of time the respondent had agreed to settle any amounts or paid any amounts to the petitioner towards alleged settlement. On the contrary, it is the petitioner who is liable to pay an amount of Rs. 29.99 crores to the respondent. Instead of paying the said amount the petitioner is raising false claims. 9.10 In para 14 of the Counter it is averred that the respondent has admitted debt of Rs. 4,17,59.811/- as alleged by the petitioner in the petition and the rejoinder. Whereas, Annexure-A and proceedings before the Banking Ombudsman between RBL Bank and the petitioner establish that the issue was between RBL Bank and the petitioner and respondent had nothing to do with the alleged amount. It is thus, alleged that the petitioner makes multiple averments to harass the respondent. 10. We have heard the learned counsel for the operational creditor and the learned counsel for the corporate debtor. This application is filed under section 9 of the I&B Code alleging that the corporate debtor committed default of an amount of Rs. 10,28,69,811/- along with interest at the rate of 18% per annum. The said ....
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....that there was an understanding between the operational creditor and the partner-bank of the corporate debtor, namely, RBL Bank and there was unblocking of cards by RBL Bank. Thus, the cards were subsequently unblocked. Therefore, the claim was restricted as far as the failure to supply gift cards worth Rs. 6,11,10,000/-. Thus, the operational creditor is restricting the claim to the above amount. In this connection the operational creditor filed an affidavit. The learned counsel contended that unblocking of cards by RBL Bank was done only at the instance of the corporate debtor after filing of the present case. The learned counsel contended that there was no pre-existing dispute and the alleged dispute is spurious, imaginary and there is no document to substantiate the same. 13. E-MAIL WRITTEN ARGUMENTS DATED 01.06.2020 FILED BY THE OPERATIONAL CAREDITOR. The learned counsel for the operational creditor submitted Written Arguments on 01.06.2020. The points urged in the Written Arguments will be dealt with in the course of the order. The learned counsel for the ' operational creditor would contend that an amount of Rs. 6,02,59,811/-was given to the corporate debtor towards Gi....
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....RE ALLIANCE (INDIA) Pvt. LTD Vs. KAY BOUVET ENGINEEERING LTD. COMPANY, rendered in Company Appeal (AT) (Insolvency) No. 582 of 2018 and contended that the amount advanced is in respect of the provision of goods and services and falling within the ambit of operational debt. The learned counsel also relied on the decision of the Hon'ble Mumbai Bench dated 23.02.2018 in the matter of AUSPICE TRADING PRIVATE LIMITED Vs. GLOBAL PROSERV LIMITED, rendered in CP No. 1584/IBC/NCLT/MB/MAH/2017 and contended that advance given is operational debt in a given circumstance of the case. Thus, the learned counsel contended that the defence taken by the corporate debtor as if there was pre-existing dispute is not supported by any material and as such the petition is liable to be admitted. 15. On the other hand the learned counsel for the corporate debtor vehemently contended that there was a pre-existing dispute. The learned counsel contended that the operational creditor had played fraud and obtained cards and an amount of Rs. 31 crores fell due. The learned counsel contended that the operational creditor filed fabricated invoices obtained in collusion with the erstwhile staff members of the ....
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....cards. The learned counsel contended that it is the OC, who was liable to pay to the corporate debtor. On verification it is found that the operational creditor had taken excess cards from the corporate debtor and thus, an amount of Rs. 31 crores fell due. On great persuasion the operational creditor has paid a sum of Rs. 6,11,10,000/- and the same was adjusted against the outstanding balance. Thus, there is no default of the alleged operational debt and that the petition is liable to be rejected. 16. The learned counsel for the corporate debtor relied on the following decisions: (i) Mobilox Innovations Private Limited Vs. Kirusa Software Private Limited, (2018) 1 SCC 353. (ii) Transmission Corporation of Andhra Pradesh Limited Vs. Equipment Conductors & Cables Ltd., - Supreme Court. (iii) Anjani Gases Vs. BP Projects Private Limited, MANU/NC/0034/2019 : - NCLT, Kolkata. (iv) A.D. Electro Steel Company Private Limited Vs. Anil Steels, MANU/NL/0146/2017 : - NCLAT, New Delhi. (v) SP Changalvaraya Naidu Vs. Jagannath & ors., 1994 (1) SCC. (vi) Vision Millennium Exports Private limited Vs. Edelweiss Rural & Corporate Services Private Limited, CP (IB) No. 387/9/HDB/2019- NC....
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.... is also stated that some new invoices are also filed by the operational creditor which were not there in the invoices filed with the petition. Certain invoices are also noticed in which there are discrepancies. It is also contended that multiple invoices are signed with the same pen creating doubt over its veracity. There are variations in the discount in certain invoices issued on the same day. Thus, the corporate debtor has noticed so many errors in the original invoices filed. One important discrepancy noticed in majority of invoices is that they were all signed with the same pen. When invoices are all of different dates, then how the same pen is used in all these invoices. It is an unexplained suspicion hovering around these invoices. 20. Lot of variations with regard to the discount appearing in the invoices. It is the specific case of the corporate debtor that the discount was allowed from 1% to 2% and not more than that. Whereas, in the invoices said to have been issued by the corporate debtor, which are filed by the OC, the discount allowed is between 3.25% and 4%. The invoices ' where discount is allowed between 3.5% to 4% are all signed by different persons. The cor....
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....tor that this amount was given for supply of 6300 gift cards at Rs. 10,000/- per card. Whereas the case of the corporate debtor is that there was a balance to the tune of Rs. 31 crores to be paid by the operational creditor and that this money was given by the operational creditor towards part-payment for the outstanding balance and the same was also informed to the operational creditor by the corporate debtor through e-mail dated 07.10.2018. 24. A dispute was existing between the operational creditor and the corporate debtor which was much prior to the Demand Notice. This dispute was not raised after the Demand Notice. Whether this dispute is spurious, hypothetical or illusory? If the dispute falls in any of three categories, then such a dispute cannot be taken note of, because the corporate debtor has categorically admitted having received Rs. 6,11,10,000/-. 25. It is also not in dispute that Legal Notice was issued on 09.10.2018 on behalf of the operational creditor to the corporate debtor in respect of an amount of Rs. 6,11,10,000/-. A reply was given to this Legal Notice on behalf of the corporate debtor dated 23.10.2018. Both the sides filed legal notice and reply. In the r....