TaxTMI 
TaxTMI 
2022 (1) TMI 457
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.... the operational creditor. 2. The gist of the averments in the Application are that: the applicant here in after referred as the Operational Creditor is a private limited company. As accessed through the Ministry of Corporate Affairs website the Operational Creditor is registered with RoC, Chandigarh with CIN U28939PB1998PTC021859. 3. The Respondent herein after referred to as the Corporate Debtor too is a private limited company having CIN U45203TG1979PLC057431 registered with RoC, Hyderabad. 4. The operational creditor would contend that it has supplied various kinds of materials to Corporate Debtor such as, bolts, washers and other related items under various invoices on different dates. Invoice amounts were required to be paid within 15 days of the date of invoice, failing which the Corporate Debtor is liable to pay interest at the rate of 18% per annum. Since the Corporate Debtor failed to pay the invoice amounts, the Operational Creditor had issued Demand Notice in Form-3 dated 01.07.2019 (page 174 of the petition). However as there was no response from the Corporate Debtor, the Operational Creditor has preferred this application on the basis of invoices, purchase or....
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....n by the Corporate Debtor. Further, Corporate Debtor has acknowledged the debt vide e-mail dated 30.03.2017. As regards shortage of material and claiming an amount of Rs. 1,886,261/-, Operational Creditor contends that such a contention is raised for the first time. It is baseless and false. Corporate Debtor while admitting the claim has paid Rs. 1,49,001/-. Inter Office Memo dated 02.01.2016 is crucial. EDEC exemption certificates were submitted on 02.01.2016 and supplies made thereafter attract no excise duty. However, invoices prior to 02.01.2016 attract excise duty and Corporate Debtor is liable to pay the same. 7. Learned counsel for the Corporate Debtor also filed Written Submissions broadly contending that, * The Corporate Debtor is not insolvent. The Corporate Debtor has not admitted its debt and refuted the claim of the Operational Creditor. Thus, the present petition is required to be dismissed as this forum cannot be used as a recovery mechanism. In support of its contention the Corporate Debtor has relied on decision of the Hon'ble Apex Court in the matter of Transmission Corporation of Andhra Pradesh Limited Vs. Equipment Conductors and Cables Limite....
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.... Ltd. & another, (2020) 15 SCC 1, wherein it was held that, 8. In light of the afore-stated rival contentions, the points that emerge for consideration by the Tribunal are: (i) Whether the application is barred by limitation? (ii) Whether the Operational Creditor has made out a case for ordering initiation of Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor? We have heard the Ld. Counsels for both sides at length, perused the record and the case law. POINT No. (i): 9. It is needless to say that it is for the suitor/applicant to establish that the debt claimed as due and payable by the Corporate Debtor herein is not barred by limitation, whether or not the Corporate Debtor has raised the said plea. Learned counsel for the Operational Creditor submitted that the subject claim pertains to Purchase Orders (POs) dated 09.07.2015, 09.07.2015 and 04.11.2015 respectively and the payments in respect of same were made by the Corporate Debtor in parts in between June 2015 and 30th March 2017 as is evident from the undisputed ledger account (page 23 of the application), the present application having been filed on 15.10.2019 is well with....
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....25,71,244/- with interest at the rate of 18% amounting to Rs. 18,49,665/- as on 30.09.2019. The said liability of Rs. 25,71,244/- consists of the following: 12. Learned counsel for Operational Creditor submitted that the supply of the material covered under the afore stated purchase orders attracts payment of excise duty by the corporate debtor and in order to avail exemption from payment of excise duty the corporate debtor shall comply Clause 4.0 of the Purchase Order, which is as follows: "4.0 Excise Duty: Excise Duty shall be exempted vide Excise Duty Exemption Certificate (EDEC) under Excise Notification 108/95-CE through RRVPNL issued in name of M/s. Nexo Industries Limited. TPL shall furnish EDEC for availing the excise exemption in advance prior to dispatch." 13. Relying on the aforesaid clause, learned counsel for the operational creditor submitted that as the Corporate Debtor failed to submit Excise Duty Exemption Certificate for short "EDEC", prior to dispatch of material as envisaged under the clause 4.0 supra, the Operational Creditor was compelled to pay the same as such the Corporate Debtor is bound/liable to reimburse the said amount to the operational....
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....ons of Purchase Orders dated 09.07.2015, 09.07.2015 and 04.11.2015. 17. Therefore, in the above backdrop of undeniable factual matrix, it is to be seen whether the plea of the Corporate Debtor that it has submitted Excise Duty Exemption Certificate (EDEC) well before placing the relevant purchase order has been established. In this context it is to be noted that it is the specific plea of the Operational Creditor that the Corporate Debtor, for the first time vide Office Memorandum dated 02.01.2016 has submitted EDEC by which time supplies were admittedly made by the operational creditor as such the claim for payment of excise duty amount is very much sustainable. 18. It is pertinent to state that in the counter filed by the corporate debtor, the date of submission of the EDEC by the corporate debtor to the applicant is conspicuously absent. The counter states that, "18. That in pursuance of the terms and conditions of the purchase orders for Bhandla-Jodhpur and Ramgarh-Akal Projects, the corporate debtor obtained two EDEC's both dated 27.05.2015 from Rajasthan Rajya Vidyut Prasaran Nigam Limited and given to the operational creditor. Similarly, for Tapovan Pipalk....
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....the corporate debtor is the sine qua non, for setting the corporate insolvency resolution process in motion against the corporate debtor. The applicant in this case has convincingly established the same. Therefore, the petition deserves to be allowed and Corporate Insolvency Resolution Process against the respondent corporate debtor shall be ordered. 21. Insofar as the ruling in Sesh Nath Singh and others, supra, relied on by the corporate debtor is concerned, it may be stated that the said ruling lays down the law as regards the condonation of delay while filing an application under section 7 of the I&B Code, 2016, in absence of an application being filed under section 5 of the Limitation Act, besides as to the application under section 14 of the Limitation Act. These two legal issues since not involved in the case on hand, we are of the opinion that this ruling is not applicable to the facts of the case. 22. Hence, the Adjudicating Authority admits this Petition under Section 9 of IBC, 2016, declaring moratorium for the purposes referred to in Section 14 of the Code, with following directions:- (A) Corporate Debtor, M/s. Tata Projects Limited is admitted in Corpora....