TaxTMI 
TaxTMI 
2021 (11) TMI 476
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....Bankruptcy Code, 2016 (for short IBC) was rejected. 2. The facts giving rise in the instant Appeal are as under: i) That the Appellant is a Sole Proprietor construction firm, engaged in the mechanical construction work in projects since its inception in the year 1984, with specialisation in air pollution control technology and effluent treatment technology and others. ii) The Respondent - Corporate Debtor was formerly known as NTPC ALSTOM Powers Service Pvt. Ltd. and pursuant to acquisition of former company by GE Power System was changed to NTPC GE POWER SERVICES PRIVATE LIMITED with effect from 02.02.2017, having registered office at NTPC Bhawan, Scope Complex, 7 Institutional Area, Lodhi Road, New Delhi - 110003. iii) Further case of the Appellant is that the Respondent Company issued a work order, inter-alia, on 10.06.2015 bearing Work Order No. WO/15-16/28.0 (Annexure A-2 at page 65 of the Appeal Paper Book) for carrying out Electrical Erection Works and electrical works with Project Name GSECL UKAL ESP 2x200 MW. iv) The Respondent Company issued another work order bearing work order No. WO/15-16/0029.0 (Annexure A-3 at page 66 to 68 of t....
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....exure A-10 at page 125 to 207 of the Appeal Paper Book). x) The Appellant, thereafter, filed application under Section 9 of the IBC before the Ld. Adjudicating Authority bearing Company Petition No. (IB)-1722(PB) / 2019 for initiation of Corporate Insolvency Resolution Process. The Ld. Adjudicating Authority after hearing the parties vide order dated 24.10.2019 rejected the aforesaid application. Hence the Appeal. Submissions on behalf of the Appellant 3. The Learned Counsel for the Appellant during the course of argument and his memo of Appeal while assailing the impugned order submitted that the Ld. Adjudicating Authority erred in not acknowledging the fact, that the admitted debt of Rs. 1,33,40,071/- which forms only part of the claimed amount is not under dispute. The dispute if any has been raised only against the additional debt of Rs. 1,42,72,787/- and that too only on the ground that the quantum and the rate of the additional work was not agreed upon prior to the issue of the Invoice. In light thereof, the entire amount of operational debt could not have been said to be in dispute. 4. It is further submitted that the Ld. Adjudicating Authority erred in not....
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....es is hereunder: a. Terms & Conditions of Work Order (refer work order No. WO/15-16/0029 dated 12.06.2015 (at page 66 of the Appeal Paper Book) - Para titled as Change order: During the execution of the contract, NASL reserves the right to increase or decrease the scope of work envisaged under the contract. Such increase or decrease in the scope shall be covered under change order or a contract amendment. b. Standard Terms & Conditions of Work Order (refer clause No. 8 of amendment work order No. WO/15-16/0029.1 dated 07.12.2015 (at page 71 of the Appeal Paper Book) Para titled as Time Schedule: Time schedule is the essence of contract and must be adhered to. If the contractor/agency fails to complete job in time, the Purchaser may solely cancel the order at his discretion: i. Levy penalty at the rate of one per cent of the Contract price for each week's delay or part thereof subject to a maximum of 10% of the contract price or ii. Treat the order as cancelled and recover any loss or damage from the Contractor/Agency and/or. Get the complete job done or any part thereof from other source on Contractor/ Agency's account, in which case the Contract....
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.... that "first time the respondent had raised a dispute vide their letter dated 20.03.2019 and that's too was came to his knowledge after receiving the reply to the petition before the Hon'ble Principal Bench while the notice of demand was raised by the appellant on 08.03.2019 and before that the Respondent Company had never raised any dispute which in itself is a complete false statement as there was a pre-existing dispute between the parties which can be substantiated from the below mentioned facts: a. That on completion of project by the appellant, the respondent had received the final bill amounting to Rs. 1,33,40,071 for which the Respondent had assured him to make the payments (after calculating all the financial liabilities from both the sides) as soon as their payment gets released from ultimate service holder i.e. Gujarat State Electricity Corporation Limited (GSECL). Thereafter the Respondent Company had called the appellant to their office for having discussion to resolve the issues relating to outstanding amount and settling of amount of liquidated damages via email dated 07.08.2018 to which the appellant had given his consent for the meeting on 21.08.2018 (Annex....
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....r dated 29.07.2015 issued by GSECL is also attached as Annexure-4 at page 34 of the Reply Affidavit. 15. It is further submitted that the bills amounting to Rs. 1,42,72,787/- of additional work are fake bills as those bills was never part of work order and was allegedly raised unilaterally and was never been admitted by the Respondent Company and the same can be substantiated from the admission of appellant and his submission of certificate of CA of Respondent Company. 16. It is further submitted that there is a pre-existing dispute which was raised well within the time period between the parties and which comes within the definition of 'dispute' under Section 5(6) of the Code. The Hon'ble Apex Court in landmark judgement reported in "2018 (1) SCC 353 'Mobilox Innovations Private Ltd. Vs Kirusa Software private Ltd." had very well interpreted the term "dispute" and "existence of dispute". The Hon'ble Apex Court ruled that the definition of 'dispute' is inclusive and not exhaustive. It must be given wide meaning. The 'dispute' is not limited only to pending suit or a pending arbitration. Therefore, "the definition of the term 'dispute' has been expanded and is not restricted t....
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....t of Rs. 1,33,40,071/- is still due and payable to the Appellant. Further, additionally two separate bills of Rs. 1,19,12,821/- and Rs. 23,59,966/- both aggregating to Rs. 1,42,72,787 was also raised for additional work done. From the perusal of the Application bearing Company Petition No. (IB)-1722 (PB) / 2019 filed by the Appellant which is Annexure A-13 total amount of debt mentioned in Part-IV "Particulars of Operational Debt" is as under: It is also admitted fact that the Respondent in their Reply Affidavit filed before the Ld. Adjudicating Authority and also this Tribunal have observed that the bills amounting to Rs. 1,42,72,787/- are raised in lieu of doing additional work. The Ld. Adjudicating Authority in paragraph 35 of the impugned order have rightly taken note of the facts and also in paragraph 40 have given finding that there is a pre-existing dispute between the parties. So, based on judgment passed by Hon'ble Supreme Court reported in "2018 (1) SCC 353 'Mobilox Innovations Private Ltd. Vs Kirusa Software private Ltd." (supra) the Ld. Adjudicating Authority has rightly rejected the Application filed by the Appellant under Section 9 ....