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TaxTMI 
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2024 (8) TMI 670
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....rational Creditor seeking admission of the Corporate Debtor- Lykos India Pvt. Ltd. into Corporate Insolvency Resolution Process ('CIRP' in short). Aggrieved by the impugned order, the present appeal has been filed by the Appellant. 2. We have heard Shri Mohit Nandwani, Ld. Counsel appearing for the Appellant and Shri Abhishek Anand, Ld. Counsel representing the Corporate Debtor-Respondent. 3. Putting together the factual matrix of the case in brief, the Appellant- Operational Creditor had entered into a business relationship with the Respondent-Corporate Debtor by which the Operational Creditor purchased aluminium rods from the Corporate Debtor and sold copper cathodes to the Corporate Debtor. In this process, the Operational Creditor raised multiple invoices in respect of the cathode rods supplied to the Corporate Debtor. The Operational Creditor claimed that the Corporate Debtor had committed a default in the payment of Rs. 11.52 cr for the goods supplied including interest amount. The Operational Creditor issued the first demand notice under Section 8 of IBC on 18.10.2019 which was revised and resent on 22.10.2019. It is pertinent to note that in both the demand notices, t....
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....s credibility since the said amount was paid to some third entity- TDT Copper Ltd and not to the Operational Creditor. It was also pointed out that there were no documents or material placed by the Corporate Debtor to show any consent given by the Operational Creditor for the alleged transfer of Rs. 5.96 cr to TDT Copper Ltd. on their behalf or any acknowledgement of receipt from the Operational Creditor. Hence, this amount stood outstanding as debt both due and payable. 5. Repelling the above arguments raised by the Appellant, it has been contended by the Ld. Counsel for the Respondent that there were no outstanding claims of Operational Creditor. While admitting that the Operational Creditor had raised 11 invoices, it was denied that their accounts were based on running account basis. Submitting that payments were made by them on invoice to invoice basis, it was vehemently contended that there was no outstanding debt in respect of the first ten invoices. It was also submitted that payment of Rs.5.96 cr was also not outstanding as the said sum had already been transferred to the account of TDT Copper Ltd. which was a group company of the Operational Creditor. It was also submit....
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....8/- on 19.10.2016 and 30.01.2019 respectively. As contended by the Corporate Debtor out of 11 invoices raised by the applicant, 10 invoices dated 25.07.2016, 27.08.2016, 09.09.2016 and 02.02.2017 are barred by Limitation and the claim in respect of the 11th Invoice dated 30.01.2019, is not due on account of Pre-existing dispute. Also, the date of default pleaded by the Applicant in Part IV of Form 5 as well as in Section 8 Demand Notice is 25.07.2016 and the present application has been filed on 04.03.2020. ..... 14. On the perusal of records before us, it is observed that the 10 invoices dated 25.07.2016, 27.08.2016. 09.09.2016 and 02.02.2017 are barred by limitation because as contended by the Operational Creditor, the accounts maintained between the Operational Creditor and the Corporate Debtor is not a running account as there was invoice to invoice payments made by the Corporate Debtor. As per the ledger Account annexed as Annexure-6 in main application it can be concluded that the account maintained by the Operational Creditor and Corporate Debtor is a mutual and but not running account evidencing inter se sales and purchase of copper and aluminium goods. Th....
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.... Section 18 of the Limitation Act, 1963. Furthermore, the claims against the 11th invoice no. 77 was also paid on 31.01.2019 which also extends the period of limitation. 10. We glean from material placed on record that the date of default pleaded in the Section 8 Demand Notice at page 68 of the Appeal Paper Book ('APB' in short) as well as in the Section 9 application at page 99 of the APB is shown as 25.07.2016. We also notice that 10 out of the 11 invoices were dated between 25.07.2016 and 02.02.2017. It is the case of the Corporate Debtor that even taking into account the date of the 10th invoice which was 02.02.2017, the claim against it stood barred on 01.02.2020 which pre-dated the filing of Section 9 application which happened to be 04.03.2020. Hence all the 10 invoices, except the 11th invoice no. 77, stood time barred. It is well acknowledged that the period of limitation for an application under Section 9 of IBC is undisputedly three years as prescribed by the Limitation Act. Since the date of default is the starting point for counting of limitation and such date of default having been specifically shown as 25.07.2016 in Part IV by the Appellant in respect of these 10 ....
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....r. Furthermore, the email address [email protected], used to send the letter on 13.06.2019, was also used to issue Invoice 77 of 2019. This indicates that both the Operational Creditor and TDT Copper Ltd. were aware of and acknowledged the transfer. Therefore, it is inferred that both parties were aware of and consented to the transfer and the claim for the invoices dated 25.07.2016, 27.08.2016, 09.09.2016 and 02.02.2017 has been paid by the Corporate Debtor." 14. At this stage, before we come to our analysis, we would like to reproduce 13.06.2019 letter which is as extracted below: "The Finance Department, Lykos India Private Limited Mumbai Subject: Transfer of Debit/Credit balance Dear Sir/Madam, As per transactions history noted in the books of accounts between our company "Ashoka Creations Pvt. Ltd" and "Lykos India Private Limited". We have a debit balance of Inr 5,96,78,191.08 /- (Rupees Five Crore Ninety Six Lakh seventy Eight Thousand One Hundred Ninety One and Eight Paise only) as on 31.03.2018. This implies amount due from Lykos India Private Limited to be received to our account (TDT Copper Limited)....
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....ondent that though this ledger account was filed by the Appellant before the Adjudicating Authority, the same was deliberately not made part of documents by the Appellant before this Tribunal. Hence, this ledger statement was placed before this Tribunal by the Respondent in their additional affidavit as already reproduced supra. When a pointed query was made by this Bench to the Ld. Counsel for the Appellant as to whether this statement was a part of the in pleadings before the Adjudicating Authority, the Ld. Counsel for the Appellant conceded that the ledger statement did form a part of their pleading before the Adjudicating Authority but has been omitted now. We clearly deprecate such conduct on the part of the Appellant to supress material records to improve their case. This ledger statement persuasively removes all ambiguity from our minds that the amount of Rs. 5.96 cr claimed by the Operational Creditor as outstanding is bereft of any foundational basis and has been falsely trumped up the Operational Creditor. We are fully convinced that the Corporate Debtor having already extinguished its liability of Rs. 5.96 cr, no debt is due and payable in respect of the first 10 invoice....
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....19, which is placed on record as Annexure 4 requested the delivery of remaining quantity of Copper Cathodes to complete the transaction. It is stated that the balance would be paid on the delivery of remaining quantity of Copper Cathodes. Corporate Debtor has raised the dispute much prior to issuance of demand notice dated 18.10.2019 and 22.10.2019, thus, there exists a Pre-existing before the issuance of Demand Notice as per Section 8. 19. The Hon'ble Supreme Court of India in the matter of Innoventive Industries Limited vs. ICICI Bank, (2018) 1 SCC 407 interpreted the word 'due' as "payable unless interdicted by some law or has not yet become due in the sense that it is payable at some future date." In the present case, the dues as to Invoice 77 is Rs. 75,38,292/- and the Corporate Debtor had paid Rs. 71,61,378/- to the tune of 95% of invoice. As per the Annexure 4 & Annexure 8 of the Application, the Operational Creditor has acknowledged the email dated 30.01.2019 wherein the Corporate Debtor has asserted that the payment would be 95% of the invoices and remaining would be paid at the delivery of remaining quantity of Copper Cathodes. Therefore, the contention of the Co....