TaxTMI 
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2022 (2) TMI 142
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....te Debtor M/s. Royal International Trade and Allied Products Pvt. Ltd. in 2017 for purchase of Raw Cashew Nuts Crops. The purchase money had to be paid in advance. When the supply was made, there was a short-supply of 268.139 MT amounting to Rs. 4,10,22,661/- (Rupees Four Crores Ten lakhs Twenty Two Thousand Six Hundred and Sixty One Only). This short supply was acknowledged by, the Corporate Debtor and issued Cheque No. 10055498 dated 30.10.2017 for an amount of Rs. 2,93,26,058/- (Rupees Two Crores Ninety-Three Lakhs Twenty-Six Thousand and Fifty-Eight Only) to the Operational Creditor and another Cheque No. 10055499 dated 30.10.2017 for an amount of Rs. 1,15,00,000/- (Rupees One Crore Fifteen Lakhs Only) as full and final settlement to M/s. Kripa Cashew Exports (sister concern of M/s. Thankam Cashew Factory). These Cheques, on presentation were returned due to "Insufficient Funds" in the account of the Corporate Debtor. 3. The Corporate Debtor vide letter dated 07.05.2018 cancelled the above mentioned 2 cheques and issued 3 new cheques bearing Nos. 10055508 dated 09.05.2018 for an amount of Rs. 1,00,000/-, 10055509 dated 14.05.2018 for an amount of Rs. 1,00,000/-, and 10055510 d....
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....yment of the unpaid operational debt. Hence the present application has been instituted to initiate Corporate Insolvency Resolution Process against the Corporate Debtor. Submissions of the Corporate Debtor 7. The Corporate Debtor filed a counter/reply statement contending that they entered into a 'High Sea Sale Contract', with the applicant/Operational Debtor on 31.05.2017 for import of Raw Cashew Nuts weighing 800 MT (+/- 10%) from Bissau Port in Republic of Guinee Bissau to Tuticorin Port in India. However, the said contract could not be materialized fully because of the fraud played by the end supplier' Mr. Aneesh Babu who was the actual supplier of Raw Cashew Nuts to the Corporate Debtor. Despite the efforts, a supply shortage of 268.139 MT occurred. A dispute regarding the quantity of goods arose between the applicant/Operational Creditor and the Corporate Debtor. 8. The Corporate Debtor stated that he has filed a petition with Anchal Police Station [Kollarn Rural Police District, State of Kerala] on 17.12.2019. As the local police refused to register a First Information Report, the Corporate Debtor u/s. 154(3) of Code of Criminal Procedure 1973 approached the S....
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....other, on the same cause of action. 13. The learned counsel for the Respondent further argued that the Cause of Action of this Petition arose on 31.05.2017, the day on which the High Sea Sale Contract was entered into between the Operational Creditor and the Corporate Debtor. That the present application has been filed only on 15.09.2021. Therefore, the same is barred by the provisions of Limitation Act. To fortify his argument, the learned counsel has referred to a decision of the Hon'ble Supreme Court B.K. Educational Services Pvt. Ltd. v. Parag Gupta and Associates [CA 23988 of 2017], wherein the Hon'ble Supreme Court of India held in Para 28 of the Judgment that Limitation Act is applicable to Section 7 and 9 applications filed under the I & B Code. 14. Regarding the identity of the applicant, the learned counsel for respondent argued that the instant application filed on 15.09.2021 has not been signed by the Petitioner and it contains only the alleged Left Thumb Impression of the applicant. The cause of action of this application, i.e., the 'High Sea Sale Contract' dated 31.05.2017 contains the signature of the applicant herein. Moreover, the Left Thumb Impre....
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....efore the receipt of Section 8 Notice under IBC, 2016. 17. The learned counsel for the Corporate Debtor had specifically stated about the pending dispute regarding the High Sea Sale Contract and also with regard to the pending disputes in the reply to Demand Notice. He further stated that the Respondent is commercially solvent and more than capable of discharging its lawful debts as and when they fall due in accordance with law. Hence, this application is nothing, but part of an elaborate stratagem engineered to illegally extract monies and deprive the Respondent of its dues, and that the Petitioner is misusing the provisions of the Insolvency and Bankruptcy Code as a money recovery tool. In this regard, the learned counsel referred to the judgment of the Hon'ble Supreme Court of India in Transmission Corporation of Andhra Pradesh Limited v. Equipment Conductors and Cables Limited , wherein it is stated that: "In a recent judgment of this Court in Mobilox Innovations Private Limited vs. Kirusa Software Private Limited (2018) 1 SCC 353, this Court has categorically laid down that IBC is not intended to be substitute to a recovery forum. It is also laid down that whenever ther....
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....Section 9(3), along with the application, the statutory requirement is to furnish a copy of the invoice or demand notice, an affidavit to the effect that there is no notice given by the corporate debtor relating to a dispute of the unpaid operational debt and a copy of the certificate from the financial institution maintaining accounts of the operational creditor confirming that there is no payment of an unpaid operational debt by the corporate debtor. Apart from this information, the other information required under Form 5 is also to be given. Once this is done, the adjudicating authority may either admit the application or reject it. If the application made under subsection (2) is incomplete, the adjudicating authority, under the proviso to sub-section (5), may give a notice to the applicant to rectify defects within 7 days of the receipt of the notice from the adjudicating authority to make the application complete. Once this is done, and the adjudicating authority finds that either there is no repayment of the unpaid operational debt after the invoice [Section 9(5)(i)(b)] or the invoice or notice of payment to the corporate debtor has been delivered by the operational creditor ....
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....rate Debtor. 19. The learned counsel appearing for the applicant argued that the Original Suit (O.S. No. 563 of 2020) filed by the Corporate Debtor against the applicant, is stated to have been filed on 07.12.2020. The Corporate Debtor has produced it to show that there is a dispute regarding the debt between the parties pointing out that one of the conditions required under the dictum laid down by the SC in Mobilox Innovations Private Limited v Kirusa Software Private Limited. reported in 2018 (I) SCC 353. 20. The applicant stated that Mr. Jackson Jose is the proprietor of M/s. Kripa Cashew Exports and an amount of Rs. 1,16,96,603/- was paid to the Corporate Debtor out of the funds of M/s. Kripa Cashew Exports. M/s. Kripa Cashew Exports thereby initiated the CIRP proceedings before this Tribunal by issuing Demand Notice on 30.09.2020. The Corporate Debtor has filed a reply dated 10.10.2020 to the demand notice. In that reply notice the Corporate Debtor has not mentioned about the pendency of any suit or proceedings against the Applicant. The Application under Section 9 was filed by M/s. Kripa Cashew Exports on 26.11.2020. In the Original Suit as mentioned above, the Corporate De....
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....codified in Section 11, that does not bar its application to other judicial proceedings, such as the one in the present case. 26. Before proceeding further, it is important to compare the reliefs sought by the applicant both the IBC Applications. They have been tabulated below, for an easy comparison: Case Number CP (IB)/ 03/ KOB/ 2020 CP (IB)/ 39/ KOB/ 2021 Case Name Thankam Cashew Factory v Royals International Trade and Allied Products Private Limited Jose Samuel v. Royals International Trade and Allied Products Private Limited Filed on 16.02.2021 15.09.2021 Filed by M/s Thankam Cashew Factory, represented by its proprietory Shri. Jose Samuel through Power of Attorney holder Shri. Jackson J. Shri. Jose Samuel Claim Amount Rs. 2,93,26,058/- Rs. 2,93,26,058/- Debt Amount Rs. 4,00,22,035/- Rs. 4,03,23,329/- Cause of Action High Sea Sale Contract dated 31.05.2017 High Sea Sale Contract dated 31.05.2017 Result In view of the order dated 29.07.2021, CP(IB)/03/KOB/2021 is allowed to be withdrawn. Present application. 27. From the above table, it is clear that the prayers in the first application and second Application for initiation of CIRP were identical. How....
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....udicata. Thereafter, after an extended period, the costs were paid. 31. In the aforesaid circumstances, whether the case is finally decided by the Tribunal does not arise, as the intention behind the withdrawal of the application is well known to both parties. 32. Now, we may take up the second issue pointed out by the learned counsel for the Corporate Debtor, regarding the identity of the applicant. On a verification of the records, it is seen that nowhere the applicant has put his signature, even though, while the High Sea Sale Contract was executed on 31.05.2017, the same person who, stated to have been filed this application has put his signature. Nowhere in the application, it is stated why the applicant could not sign and on whose presence the Left Thumb impression has been taken and that anybody has counter signed or attested the Left Thumb Impression of the applicant in the application. We therefore relied on Rule 128 of NCLT Rules, 2016 for further clarification. It is stated that "128. Affidavits of illiterate, visually challenged persons.- Where an affidavit is sworn or affirmed by any person who appears to be illiterate, visually challenged or unacquainted with th....