TaxTMI 
TaxTMI 
2020 (10) TMI 387
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....ian Companies Act. 4. Brief Facts of the petition are: i. The learned counsel for the petitioner stated the applicant operational creditor sought to avail service of the respondent for construction of civil work road laying at its office at Samalkha and pursuant thereto, it held a discussion with the corporate debtor on 27.02.2019 and thereafter corporate debtor forwarded a copy of BOQ to the applicant quoting a sum of Rs. 1,97,50,000/- the total price for the work. ii. Further stated that the Corporate debtor thereafter raised a tax invoice of. Rs. 1 Cr. to the applicant vide tax invoice dated 02.03.2017. iii. Further stated that the Applicant thereafter on 05.03.2019 and 06.03.2019 transferred the aforesaid sum of Rs. 1 Cr. after deducting a sum of Rs. 2 Lakhs towards TDS. iv. Further stated that after remitting the aforesaid payment, the applicant issued a purchase/ work order to the Corporate debtor. The Applicant sought the delivery of materials on 05.04.2019 at its site. v. Further stated that while placing work order, the applicant mentions the site and sought delivery of goods at the mentioned site and therefore, the say of Co....
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....deducting the applicable taxes and after being fully satisfied that the said amount is a non-refundable mobilization advance. iii. The petitioner had never raised any objection against proposal submitted by the Respondent against the terms and conditions of the proposal dated 28.02.2019. iv. Petitioner had never made any averment in its letter dated 15.05.2019 qua any breach or default committed by answering Respondent in performance of its obligations under the Contract. However, baseless averments of breach of obligations had been raised for the first time only in the Notice of demand dated 04.07.2019, which was only an afterthought to raise a false claim against the Respondent. v. The amount of Rs. 98,00,000/- had been rightly forfeited by the Respondent in terms of the Agreement and no contractual default is being committed by the respondent. vi. The work has already been subcontracted by the Respondent to M/s. SEW Infrastructures Ltd. vide work order dated 07.03.2017 for a total contract value of Rs. 1,66,13,116/-. The Respondent had already paid an amount of Rs. 81,00,000/- in favour of M/s. SEW Infrastructure Ltd. on 08.03.2019 after deduc....
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....the issue or not. 9. He further submitted that petitioner also placed reliance upon the decisions and the same is quoted below:- (i). Company appeal (AT) No. 582 of 2018, Overseas Infrastructure Alliance (India) Pvt. Ltd. Vs. Kay Bouvet Engineering Ltd, decided on 21.12.2018 (ii). CP No. 1548/IBC/NCLT/MB/MAH/2017 M/s. Auspiece Trading Pvt. Ltd. Vs. M/s. Global Proserv Limited, decided on 23.02.2020. 10. In the light of the aforesaid decisions, the petitioner submitted that respondent is not entitled to forfeit the amount and he further submitted that the respondent fails to show that any loss is caused, when the work has allotted to mobilize the resources, whereas the Ld. Counsel for respondent submitted that before issuance of Section 8 demand notice vide letter dated 15.05.2019, terminated the work order and demanded an amount of Rs. 1 Crore from the respondent and respondent vide letter dated 04.07.2019 raised the dispute. He further submitted that in the Mobilox Innovations Pvt. Ltd Vs. Kirusa Software Pvt. Ltd. (2018) 1 SCC 353 held that even if the application is complete and if notice of dispute has been received by the Operational Creditor then Secti....
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.... point raised by the petitioner in a proceeding, which is initiated under Section 9 of the IBC. Therefore, we would like to refer Section 8 & 9 of the IBC and the same is quoted below:- "Section -8. (1) An operational creditor may, on the in such form and manner as may be prescribed. (2) The corporate debtor shall, within a period of ten days of the receipt of the demand notice or copy of the invoice mentioned in sub-section (1) bring to the notice of the operational creditor-- (a) existence of a dispute, if any, or record of the pendency of the suit or arbitration proceedings filed before the receipt of such notice or invoice in relation to such dispute; (b) the payment of unpaid operational debt-- (i) by sending an attested copy of the record of electronic transfer of the unpaid amount from the bank account of the corporate debtor; or (ii) by sending an attested copy of record that the operational creditor has encashed a cheque issued by the corporate debtor. Explanation.--For the purposes of this section, a "demand notice" means a notice served by an operational creditor to the corporate debtor demanding pay....
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....there is no record of dispute in the information utility; and (e) there is no disciplinary proceeding pending against any resolution professional proposed under sub-section (4), if any. (ii) reject the application and communicate such decision to the operational creditor and the corporate debtor, if-- (a) the application made under sub-section (2) is incomplete; (b) there has been [payment] of the unpaid operational debt; (c) the creditor has not delivered the invoice or notice for payment to the corporate debtor; (d) notice of dispute has been received by the operational creditor or there is a record of dispute in the information utility; or (e) any disciplinary proceeding is pending against any proposed resolution professional: Provided that Adjudicating Authority, shall before rejecting an application under sub-clause (a) of clause (ii) give a notice to the applicant to rectify the defect in his application within seven days of the date of receipt of such notice from the adjudicating Authority. (6) The corporate insolvency resolution process shall commence from the date of admission of the applicati....
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....f a default, operational creditor deliver a demand notice under Section 8(1) of the IBC of unpaid operational debt or copy of an invoice demanding payment of the amount involved in the default to the corporate debtor (ii). And corporate debtor within a period of ten days of the receipt of the demand notice or copy of the invoice mentioned in sub-section (1) bring to the notice of the operational creditor (iii), existence of a dispute, [if any, or] record of the pendency of the suit or arbitration proceedings filed before the receipt of such notice or invoice in relation to such dispute. (iv). The payment of unpaid operational debt. 17. The moment there is existence of a dispute, the corporate debtor gets out the clutches of the code the Hon'ble Supreme Court in Mobilox Innovations Pvt. Ltd Vs. Kirusa Software Pvt. Ltd. (2018) I SCC 353 held that: "24. The scheme under Sections 8 and 9 of the Code, appears to be that an operational creditor, as defined, may, on the occurrence of a default (i.e., on nonpayment of a debt, any part whereof has become due and payable and has not been repaid), deliver a demand notice of such unpaid operational d....
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....t to hold that the reply of the demand notice is filed within 10 days from the date of receipt of demand notice and this fact has not been disputed by the petitioner. 19. At this juncture, we would also like to refer letter dated 04.07.2019 sent by the Corporate Debtor to the Operational Creditor which is at page 39 of the application filed on behalf of the petitioner in which he referred at e-mail dated 06.03.2019 which shows that it is stated that aforesaid Rs. 1 crore advance and GST of 18 per cent totalling of Rs. 1.18 crores would not be refundable under any circumstances whatsoever and applicant is claiming that amount and that is the reason in course of arguments, he raised the issue that whether the amount deposited can be forfeited or not. On the basis of that arguments, we find that this letter and e-mail mentioned in that e-mail, by which he raised the dispute was sent prior to the delivery of the demand notice. Therefore, on the basis of that Ld. Counsel for respondent submitted that he raised the dispute prior to the delivery of demand notice and as per agreement, he forfeited the amount which the applicant claimed by filing this application as defaulted amount. The....