TaxTMI 
TaxTMI 
2021 (12) TMI 385
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....1 to 5 herein to refund all payments received by them on 19.08.2020 and 20.08.2020 respectively details of the order as hereunder: " a) Respondent No. 1 to refund an amount of Rs. 1,26,522/- in the account of corporate debtor under the control of the applicant/RP. b) Respondent No. 2 to refund an amount of Rs. 89,694/- in the account of corporate debtor under the control of the applicant/RP. c) Respondent No. 3 to refund an amount of Rs. 4,08,290/- in the account of corporate debtor under the control of the applicant/RP. d) Respondent No. 4 to refund an amount of Rs. 1,578/- in the account of corporate debtor under the control of the applicant/RP. e) Respondent No. 5 to refund an amount of Rs. 11,63,683/- in the account of corporate debtor under the control of the applicant/RP. 9. In the above terms, application is allowed and disposed off." 2. The facts giving rise in the instant Appeal are as under: i) The Company Petition No. IB-2695/ND/2019 was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (for short IBC) by one M/s Mykind Vacations Pvt. Ltd. (Operational Creditor) against the M/s Dion Global Soluti....
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....d that payments to the tune of Rs. 17,89,767/- have been made by employees on 19.08.2020 and 20.08.2020 to the creditors of the Corporate Debtor (being the vendors and the Government Authorities). The details transactions are as under: Date Amount Paid Description of Payment 19.08.2020 1,26,522 Payment to PJ Networks for the period of 15-08-2020 to 16-08-2021 20.08.2020 4,08,290 Payment to PF Department : (Employer and Employee contribution) for the month of July 2020 20.08.2020 1,578 Employee State Insurance Department: Employer and Employee Contribution for the month of July 2020 20.08.2020 89,694 Adernalin eSystems Limited: Monthly Subscription for Cloud HR platform 20.08.2020 11,63,683 GST Department: Goods and service Tax for the month of July 2020 v) Further case is that the said payments had been made even before the Respondent herein took charge of the Corporate Debtor and the payments were made for the services availed by the Corporate Debtor prior to the CIRP period. The copy of Bank statements for the month of August 2020 and copy of invoices, challanas and payment proofs have been annexed. The Respondent (RP) imme....
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.... (a) such transaction as may be notified by the Central Government in consultation with any financial regulator; (b) a surety in a contract of guarantee to a corporate debtor." 8. The Learned Counsel for the Appellant while referring on Judgment passed by this Appellate Tribunal in Company Appeal (AT) (Insolvency) No. 334 of 2017 " Dakshin Gujarat VIJ Company Ltd. Vs. M/s. ABG Shipyard Ltd. & Anr. dated 08.02.2018 wherein Hon'ble Bench of this Tribunal held as under: " 13. However, from the provisions of 'I&B Code' and Regulations, we find that no prohibition has been made or bar imposed towards payment of current charges of essential services. Such payment is not covered by the order of 'Moratorium'. Regulation 31 cannot override the substantive provisions of Section 14; therefore, if any cost is incurred towards supply of the essential services during the period of 'Moratorium', it may be accounted towards 'Insolvency Resolution Process Costs', but law does not stipulate that the suppliers of essential goods including, the electricity or water to be supplied free of cost, till completion of the period of 'Moratorium'. Payment if made towards essential g....
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....ces referred in Section 14(2) shall mean: 1. Electricity 2. Water 3. Telecommunication Services 4. Information Technology Services To the extent, these are not a direct input to the output produced or supplied by the corporate debtor Section 14(2)" However, the Appellant has conveniently ignored that any of the services mentioned in Regulation shall only mean to be an essential service if such service is a not direct input towards the output produced/supplied by the Corporate Debtor. The Appellant falls under this category of essential services which have a direct bearing on the operation of the Corporate Debtor's output. 13. It is further submitted that it is a settled law established and laid down in Company Appeal (AT) (Insolvency) No. 331 of 2019 "M. Ravindranath Reddy v. G. Kishan and Ors." that a service cannot deemed to be essential if they are direct input to the output produced or supplied by the Corporate Debtor. In fact, such a service can only fit in the category of an "Operational Debt". The relevant extract of the judgment is reproduced below: "Further, from the usage of the term "goods or services" as given ....