TaxTMI 
TaxTMI 
2024 (4) TMI 175
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....te Limited. 2. The Respondent Company i.e. M/s Ritco Travels & Tours Private Limited is an international travel agent and is recognised by International Air Transport Association (IATA) and is in the business of giving assistance to traveling and touring public. The Appellant is also travel agency recognised by IATA, which deals with international organisations as well. The Respondent received orders for bulk booking of SOTO tickets from a global corporate client i.e. M/s Elumatec UK Limited in April, 2017. The Respondent passed / referred the booking order received by it to the Appellant. The transactions for the booking of the tickets referred to by the Respondent were accepted by the Appellant and tickets were booked by the Appellant for the passengers of M/s Elumatec UK Limited during the period of 04.04.2017 to 13.04.2017. The entire process of issue and booking of tickets was done by the credit cards of the intending purchaser of the air tickets. The payments against such booking was made through the credit cards referred by the purchaser of such tickets i.e. M/s Elumatec UK Limited. The payment through credit cards is processed by the banks issuing such credit cards when th....
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....ed by them for an amount of Rs.46,96,835/- as the reservations made by the Respondent on the credit card were fraudulent transactions. The Appellant immediately informed the same to the Respondent and requested to make the necessary payment regarding the same. On 29.05.2017, the Respondent requested the Appellant to dispute the ADMs, as credit cards used for payment were fraudulent. Respondent had also lodged police complaints. The Appellant replied to the email on the same day and informed the Respondent that the time period for raising dispute with the Airlines qua 4 ADMs was already over and for the rest 33 ADMs, the Appellant will raise the dispute with the Airlines and in case the disputes are rejected, the Respondent will be liable to pay the same. On 31.05.2017, the Respondent made a payment of lump-sum amount of Rs.3,40,000/- to the Appellant towards the above said 4 ADMs, against which the time period of raising the dispute was already over. In the meantime, the Appellant informed the Respondent on 15.06.2017, that the dispute which was raised regarding the ADMs has been rejected by the Airlines and the payment qua the same is to be made to the Airlines. The Respondent on ....
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.... the Respondent's office to intimidate and demand the payment against the alleged credit card transactions. The Respondent sent a legal notice to the Appellant on 11.08.2017 to stop such criminal acts. On 22.08.2017, the Appellant replied to the legal notice and demanded a sum of Rs.1,23,04,479/- (Rupees One Crore Twenty-Three Lakhs Four Thousand Four Hundred and Seventy-Nine Only) in respect of the SOTO tickets booked by them. Despite receiving payment confirmation before booking of tickets, the Appellant asked the Respondent to pay for the Agency Debit Memo (ADM) for the reason that the reservations bookings were fraudulent credit card transactions. The Appellant started asking the Respondent to indemnify against such losses. Appellant cannot demand any kind of payment from the Respondent, since the tickets were issued by the Appellant only after the credit cards transactions were duly honoured by the issuing Bank. After a lapse of time, the Respondent in no way can be made liable for the charge back received from the credit card issuing Bank. Various correspondences were exchanged between the Respondent and the Appellant in respect of the bookings of the air tickets booked betwe....
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.... case, it is claimed by the Respondent that neither there is any provision of service or supply of goods from the Appellant to the Respondent, nor the Respondent has ever received any money from the Appellant. The Appellant had neither supplied goods nor has rendered any services to acquire the status of an Operational Creditor. The Respondent played no role, but just acted as a referral agent / facilitator to the Appellant. The initiation of proceeding by the Appellant under Section 9 is an attempt to harass the Respondent and extort money from him. The alleged transactions on credit basis were never to be charged to the Respondent. Therefore, a charge back, later on cannot be passed on to the shoulders of the Respondent, since, the bookings were made by the Appellant itself. Appraisal 15. Heard both sides and perused the documents on record. 16. The primary issue before us is whether in the instant case the Appellant and Respondent are having relationship of Corporate Debtor and Operational Creditor. Further whether there is any pre-existing dispute between the parties which will disallow initiation of CIRP proceedings. 17. We first look into the issue whether in the instant....
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....ed: "E-mail dated 10.04.2017 from Corporate Debtor to Appellant : Dear Abu, We are taking full responsibility if you get any debit note from the airline." E-mail dated 11.04.2017 by Corporate Debtor to Appellant : "We refer to our ticketing through Corporate Credit Card kindly be advised that the card holder is our Corporate Client and the tickets are issued only after the acceptance of the payment through Corporate Card by the airline. We assure that there won't be any issue of any kind of debit notes and we are taking full responsibility of the same. Kindly instruct your day/night staff to offer quick service as there is a reluctancy / delay in service which is felt. E-mail dated 12.04.2017 from Corporate Debtor to Appellant : Dear Team, Issue below tickets on VISA CARD 4046******* - 09/17 4021******* - 02/21 4046******* - 01/19 4121******* - 02/21 If any debit note comes against those tickets, then we will be responsible." 21. The facts of the case clearly bring out that the Appellant was acting on the referral instructions of the Respondent and was issuing the air tickets on the basis of the credit card the customers details provided....
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.... (i) Whether there is an "operational debt" as defined exceeding Rs.1 lakh? (See Section 4 of the Act) (ii) Whether the documentary evidence furnished with the application shows that the aforesaid debt is due and payable and has not yet been paid? and (iii) Whether there is 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 in relation to such dispute? If any one of the aforesaid conditions is lacking, the application would have to be rejected. Apart from the above, the adjudicating authority must follow the mandate of Section 9, as outlined above, and in particular the mandate of Section 9(5) of the Act, and admit or reject the Application, as the case may be, depending upon the factors mentioned in Section 9(5) of the Act." XXX 40. It is clear, therefore, that once the operational creditor has filed an application, which is otherwise complete, the adjudicating authority must reject the application under Section 9(5)(2)(d) if notice of dispute has been received by the operational creditor or there is a record of dispute in the i....