2021 (5) TMI 212

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....6 (for brevity, AAA Rules 2016) by M/s. Aegis Steel Cast (hereinafter referred as "Operational Creditor") for initiate Corporate Insolvency Resolution Process (in short "CIRP") against M/s. PEE Industrial Valve Private Limited (hereinafter referred as "Corporate Debtor") on the ground the Corporate Debtor defaulted in paying Rs. 39,00,422.82 for supply steel cast to the Corporate Debtor (wrongly mentioned as supply of various textile products in PART-IV of the application). 2. On perusal of this application, it appears that Part - I of the Application being Form-5 disclose the particulars of the Operational Creditor as being represented by the Authorized Representative Mr. Prabhubhai Bhagwanbhai Prajapati, proprietor of Aegis Steel Cast.....

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....2 (including interest amount of Rs. 6,02,644.47) and the same was delivered on 13.06.2019. The Corporate Debtor has not made any payment inspite of repeated reminders. In response to the demand notice, the Corporate Debtor replied on 24.06.2019 stating that since the items have not been supplied within the specified time, the respondent could not get a sum of Rs. 60 lakh without completing the supplies. 6. In the reply filed on 02.12.2019, Learned Counsel for Respondent/Corporate Debtor submitted that the Respondent company convened a meeting on 13.06.2018 and drawn handwritten minutes regarding issues of short supplies, mismatches and other quality issues of radiographic test samples (page 68 to 71) and the minutes have been signed by b....

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....tor speaks about dispute with regard to the goods supplied by the Operational Creditor. It is true that the management of the Corporate Debtor has not made even admitted payment and hence deserves CIRP. 9. Upon hearing submissions and perusal of the documents placed before this Adjudicating Authority, it is seen that there is clear pre-existing dispute between the parties. The email communication between operational creditor and corporate debtor with regard to supply of mismatched items on which disputes were raised is given under: 10. It is an evident that the Pre-existing dispute from the set of emails exchanges filed along with reply at A14 to A37 as above. Further, the goods supplied by operational creditor have lot of "mismatch" ....

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....eble legal argument or an assertion of fact unsupported by evidence. It is important to separate the grain from the chaff and to reject a spurious defence which is mere bluster. However, in doing so, the Court does not need to be satisfied that the defence is likely to succeed. The Court does not at this stage examine the merits of the dispute except to the extent indicated above. So long as a dispute truly exists in fact and is not spurious, hypothetical or illusory, the adjudicating authority has to reject the application. 12. In terms of the above, the application IBA/1079/2019 stands dismissed. 13. The Registry is hereby directed to immediately communicate this order to the Operational Creditor, the Corporate Debtor by way of e-ma....