TaxTMI 
TaxTMI 
2022 (5) TMI 922
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....nal Creditor' under Section 9 of the Code. By the impugned order dated 24.02.2022, the Adjudicating Authority has admitted the 'Application' observing as follows:- "19. However, in this instant case neither any dispute was raised by the Corporate Debtor nor any payment of dues were made after receiving the notice under section 8 of the Code. Further, as per MOU dated 04th August, 2016 the terms and conditions of the MOU was to be reviewed on 30 September, 2016 and a new contract was to be entered between the parties, whereas the invoices raised by the Operational Creditor are from 10 March, 2017 to 15 September, 2017. Hence, the contention raised by the Corporate Debtor with regard to the MOU signed between the parties in 2016 is not having nexus with the said invoices. 20. Further, as submitted by the Corporate Debtor in point 6 of their Reply, there are no documents on record before us which would substantiate the contention of the Corporate Debtor that the Operational Creditor owes money to the Corporate Debtor. It is also pertinent to mention that the Corporate Debtor had never raised this issue before the filing of this application." 2. Learned Counsel for....
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.... terms and conditions of this contract will be reviewed as on 30th September, 2016 and accordingly after a fresh round of discussions a new contract will be made regarding the terms and conditions." Since the invoices raised by the Operational Creditor are subsequent to 30.09.2016, therefore, the MOU has absolutely no relevance to the issue on hand as no contract existed after 30.09.2016; that the Appellant has, under the pretext of settlement, taken several adjournments and offered varied amounts of Rs.25 lakhs, Rs.22 lakhs, Rs. 9 lakhs and Rs.13 lakhs as recent as three days ago and now at this stage is raising the issue of pre-existing disputes; 6. The Hon'ble Supreme Court in 'Transmission Corporation of Andhra Pradesh Limited' V/s. 'Equipment Conductors and Cables Limited', (2019) 12 SCC 697, while deciding the issue of Pre-Existing Dispute and in 'Mobilox Innovations Pvt. Ltd.' Vs. 'Kirusa Software (P) Limited'- 2017 1 SCC OnLine SC 353 has clearly laid down the law that the 'existence of dispute' must be Pre-Existing' i.e., it must exist before the receipt of the Demand Notice or invoice as the case may be. In 'Mobilox Innovations' (Supra) the Hon'ble Supreme Court has ob....
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.... "18. From the aforesaid decision, it is clear that the existence of dispute must be pre-existing i.e. it must exist before the receipt of the demand notice or invoice. If it comes to the notice of the Adjudicating Authority that the 'operational debt' is exceeding Rs. 1 lakh and the application shows that the aforesaid debt is due and payable and has not been paid, in such case, in absence of any existence of a dispute between the parties or the record of the pendency of a suit or arbitration proceeding filed before the receipt of the demand notice of the unpaid 'operational debt', the application under Section 9 cannot be rejected and is required to be admitted." (Emphasis Supplied) 7. It is not in dispute that the Operational Creditor supplied lab equipment and related products for business purpose of the Corporate Debtor between the period 10.03.2017 to 15.09.2018 against various invoices raised by the Operational Creditor. It is the main case of the Appellant that there were pre-existing disputes with respect to the price of the equipment supplied. In support of this argument, the Learned Counsel placed reliance on email dated 18.09.2017 and 22.09.2017. Fo....
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.... a plausible contention requiring further investigation which is not a patently feeble legal argument or an assertion of facts unsupported by evidence. The defense is not spurious, mere bluster, plainly frivolous or vexatious. A dispute does truly exist in fact between the parties, which may or may not ultimately succeed, and the Appellate Tribunal was wholly incorrect in characterizing the defense as vague, got-up and motivated to evade liability." 11. It is significant to mention that the Corporate Debtor does not deny the issuance of three cheques totalling to Rs.35,54,755/-. It is their only case that there was a pre-existing dispute between the parties. It is pertinent to note that the Corporate Debtor has not raised any pre-existing dispute in reply to the Demand Notice under Section 8 of the Code. Be that as it may, the contention of the Learned Counsel that the MOU expired on 30.09.2016 and, therefore, the amounts raised for the invoices for the subsequent period is not payable, is unsustainable as the documentary evidence establishes that the claims made by the Operational Creditor were against the invoices for the period 10.03.2017 to 15.09.2018 and have no nexus with ....