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2022 (12) TMI 476
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....orate Debtor'. A High Seas Sale Agreement was executed between the 'Appellant' and the 'Respondent' dated 23.04.2012, wherein the Appellant agreed to import crude palm oil in bulk of 500 MTs on behalf of the 'Respondent' for consideration of US Dollars 1191.25 per Metric Ton CNF/Chennai. 3. The 'Appellant' granted a loan amount of Rs.1,84,00,000/- to the Respondent vide an agreement (also referred to as "Loan Agreement") dated 09.04.2012. The said Loan Agreement was renewed vide a "Loan Renewal and Working Capital Loan Agreement" dated 21.03.2013 and the repayment period was extended until 30.06.2013. The 'Appellant' also agreed to grant a further loan to meet the working capital requirements of the 'Respondent' to the extent of Rs. 71,00,000/-. 4. It has been brought out that due to outstanding dues payable by the 'Respondent', the 'Appellant' initiated Arbitration proceedings for Rs. 5,25,00,000/- along with interest and thereafter, the 'Memorandum of Understanding' was entered into between the parties dated 21.03.2013 for the payment of the outstanding dues by the 'Respondent' on account of the "Loan Agreement" as well as the "High Seas Sales Agreement". Based on the consent ....
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....ke payment of the storage charges. 10. The Learned Counsel for the Appellant clarified that the loan as provided under the Loan Agreement was with an interest at 2.5% per month. The Learned Counsel for the Appellant further pointed out that the 'Respondent' at no time disputed aspects regarding the "Loan Agreement". 11. The Learned Counsel for the Appellant brought to the notice of this Appellate Tribunal that due to the failure of the 'Respondent' to make payment under the "Loan Agreement", the 'Appellant' initiated arbitration proceedings against the 'Respondent' and based on consent terms entered between the parties, an 'Arbitral Award' was passed on 18.03.2015. The 'Arbitral Award' was communicated to the parties by way of Procedural Order dated 30.07.2015. 12. The Learned Counsel for the Appellant submitted that a 'Memorandum of Understanding' ('MoU') was also entered into between the parties dated 23.03.2013 for repayment of the outstanding dues by the 'Respondent' to the Appellant. The Learned Counsel for the Appellant further pointed out that the terms of the 'MoU' clearly mentioned the outstanding principal payable on the part of the 'Respondent' towards: importing unde....
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.... of the 'MoU' provides dues under the "High Seas Sale Agreement" as Rs. 3,34,08,049/-, "Loan Agreement" as Rs.1,84,00,000/- and the working capital loan as Rs. 71,00,000/- and interest there upon. 18. The Learned Counsel for the Appellant stated that the Bombay High Court has upheld the 'Arbitral Award' dated 18.03.2015. The initiation of the arbitration proceedings owing to the non - payment of the loan pursuant to the Loan Agreement amounts to a 'default' under the I & B Code, 2016 and the further non - payment of the 'Arbitral Award' which confirms the 'default' of the 'financial debt' under the "Loan Agreement" also constitutes a 'default' under the I & B Code, 2016. 19. The Learned Counsel for the Appellant assailed the contention of the 'Respondent' on the letters of credit being given in favour of the 'Appellant' being irrelevant to the present dispute as ledger accounts filed by the 'Appellant' clearly state that the said letters of credit are prior to the passing of the 'Arbitral Award'. The Learned Counsel for the Appellant stated that contentions of the 'Respondent' disputing the amounts payable to the 'Appellant' on the basis of decree passed by the Munsif Court in Po....
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....ries Ltd. Vs ICICI Bank, (2018) 1 SCC 407, the 'Adjudicating Authority' had to see the records of the information utility or other evidence produced by the financial creditor to satisfy itself that a default has occurred. 26. The Learned Counsel for the Respondent assailed the conduct of the 'Appellant' who filed an application under Section 7 of the I & B Code, 2016 as well as the Appeal preferred by the 'Appellant' as an abuse of process of law and an attempt to initiate the insolvency resolution process against a solvent company fraudulently and with malicious intent. 27. The Learned Counsel for the Respondent emphasised that the 'Appellant' has also not filed with the application record of default with the information utility or such other record or evidence of default. 28. The Learned Counsel for the Respondent mentioned that the 'Appellant' had not filed any statement of its bank account/s with the application to establish the disbursement of any of the amounts mentioned in the application nor to establish what the 'Appellant' received back from the 'Respondent'. 29. The Learned Counsel for the Respondent assailed conduct of the 'Respondent' and alleged that the 'Ledger B....
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....4.2012 and the alleged loan agreement dated 09.04.2012, that an amount of Rs. 12,35,300.00 is to the credit of the 'Respondent'. 32. The Learned Counsel for the Respondent refuted the claim that the 'Appellant' is a 'Financial Creditor' for the amount claimed under the "Arbitral Award" dated 18.03.2015. The Learned Counsel for the Respondent further stated that the 'Appellant' has mainly laid stress upon the consent award dated 18.03.2015 for filing the application under Section 7 of the I & B Code, 2016 claiming itself to be a 'Financial Creditor'. The Learned Counsel for the Respondent further mentioned that as per settled position of law that the amount claimed under the decree (award) is an adjudicated amount and not a debt disbursed against the consideration for the time value of money and does not fall within the ambit of any of the clauses enumerated under Section 5(8) of the I & B Code, 2016. The Learned Counsel for the Respondent placed the Reliance on the Judgment dated 09.12.2019 passed by this 'Appellate Tribunal' in Company Appeal (AT) (Insolvency) No. 1329 of 2019 and Judgment dated 14.08.2020 passed by this 'Appellate Tribunal' in Company Appeal (AT) (Insolv....
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....espondent'- M/s Pandi Devi Oil Pvt. Ltd. (b) Whether above relationship is to be treated as 'Buyer'/'Seller' in commercial transactions or as 'Financial Creditor' and 'Corporate Debtor'. * Appellant- M/s Shakti International Pvt. Ltd. ("SIPL") is in business of importing, exporting, buying, selling, supplying, dealing in edible as well as non-edible oils etc. Respondent- M/s Pandi Devi Oil Pvt. Ltd. ("PDOPL") is engaged in business of importing crude palm oils, trading, running factory/plant for the same. * In terms of export-import policy, "PDOPL" as buyer, entered into "High Seas Sale Agreement" with "SIPL" on 23.04.2012 whereby SIPL agreed to arrange import crude palm oil of 500 MT+ 2% of the said commodity on agreed upon terms including 1.20% "SIPL" trade margin on CNF along with interest on CNF @ 18%/ 24% per annum as per pre-determined agreement for different period. "PDOPL" as buyer was also supposed to make Earnest Money Deposit @15% of value of cargo with "SIPL" as seller. * At the request of "PDOPL" Rs. 1,84,00,000/-was given by "SIPL" as a loan. However, the agreement to give effect of such loan was signed on 09.04.2012. According to this Agreement, loan was to....
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....as 'Financial Creditor' and 'Corporate Debtor'. * This Appellate Tribunal consciously has gone into "Loan Agreement" and subsequent fresh "Loan Renewal and Working Capital Loan Agreement". It is observed that although the Rs. 1,84,00,000/-was disbursed on 04.04.2012, however the formal agreement for the same was entered subsequently on 09.04.2012. From the averments of the 'Respondent', this 'Appellate Tribunal' notes alleged contention and circumstances as made out by the 'Respondent' which reads as under 'Since the Appellant was facing some difficulties in closing his books of accounts due to the transfer of large amounts from its bank account, the Appellant requested the Respondent to sign a loan agreement dated 09.04.2012.' * Prima-facie "Loan Agreement" as subsequent "Renewal Agreement" were entered into to facilitate successful completion of the original Master Agreement i.e. "High Seas Sale Agreement". It is also observed that the 'MoU' makes reasonably clear the relationship between the 'Appellant' and the 'Respondent' as 'Buyer' and 'Seller' in course of normal commercial transactions rather than as pure 'Financial Creditor' and 'Corporate Debtor'. * In view of above ....
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....2 Rs. 1,25,00,000/- was transferred back by the 'Respondent' in account of the 'Appellant'. It has further been mentioned that all outstanding payment has been made. * From the 'impugned order' 27.04.2021 it is seen that the 'Adjudicating Authority' had detailed examination of all the record and heard the submissions by both the parties in course of various stages of 17 hearings. It is for neither expected nor desirable for this 'Appellate Tribunal' to go into detailed of various claims and counter claims based on the alleged 'Ledger Accounts' of both the parties which evidently has been scrutinised in details and gone into by the 'Adjudicating Authority'. * This 'Appellate Tribunal' observes that the 'Adjudicating Authority' has treated "High Seas Sale Agreement" as a source documents. Looking to the detailed examination done by the 'Adjudicating Authority' and elaborate discussions in the preceding paragraphs, this 'Appellate Tribunal' comes to the conclusion that the 'Adjudicating Authority' has not erred in treating "High Seas Sale Agreement" as source document and other two agreements can be treated as part of full documentation. Issue No. (III) Whether the 'Arbitral Award'....