TaxTMI 
TaxTMI 
2025 (3) TMI 689
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.... Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as 'IBC, 2016') filed by the M/s Satkar Logistics Pvt. Ltd. (hereinafter referred to as the 'Operational Creditor')/Respondent No. 1. 2. The brief facts of this case as noted in the impugned order are as under: i. The petition was filed by the Operational Creditor for an operational debt of Rs. 6,66,667/- along with interest @ 24% per annum w.e.f. 19.10.2016 till realisation. ii. The Operational Creditor had rendered management/logistics services such as ocean freight charges, B/L charges, IHC/THC charges etc to the Corporate Debtor for which various invoices were raised from time to time. iii. The parties had maintained a running account. The Corporate Debtor has made part payments which were adjusted by the Operational Creditor as per "FIFO method" (First in First Out method). There was an outstanding amount of Rs. 6,66,667/-. iv. The notice under Section 8 of IBC, 2016 was issued by the Operational Creditor on 27.02.2019 and the same was replied by the Corporate Debtor on 07.03.2019. v. Before the Ld. NCLT, the Corporate Debtor took the defence of pre-existing dispute, as also that the claim is barred by l....
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....ion, we are convinced that Operational Creditor has made out case against Corporate Debtor for initiation of CIRP under the Code due to non-payment of Operational Debt of Rs. 6,66,667.40. The present application has been filed on 14.8.2019 with the last payment admittedly having been made by Corporate Debtor on 19.10.2016 on running account basis, the same is held to be within limitation u/s 137 of the Limitation Act. Therefore, this Authority admits the present Application under section 9 (5) of the I & B Code, 2016." 3. The Learned Counsel for the Appellant submitted that in its reply to Section 8 notice dated 07.03.2019, the Corporate Debtor had informed the Operational Creditor that as per their accounts, an amount of Rs. 6,94,102/- is due from the Operational Creditor against its claim of 6,66,667/-. The various accounting entries were also referred too. The relevant portion of the reply is reproduced below: "No payment is due on account of Ambassador Logistics Pvt. Ltd as per below details. 1- Bank payments (Cheques & NEFT) Year 2014 to till date - Rs.261439.00 2- Payment refund of Ambassador Logistics Year 2014-2015 - Rs.242978.00 3- TDS amount F.Y. 2013-2014, F....
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....the parties and perused the record. 10. Since the last payment was made on 19.10.2016, and the application was filed within three years, we hold that application under Section 9 of the IBC, 2016 is within limitation. On the issue of "pre-existing dispute", we find that in email dated 25.05.2018, the Corporate Debtor had clearly stated that as per their books of account and bank statement nothing is payable to M/s Satkar Logistics Pvt. Ltd., the Operational Creditor. 11. On specific query by the Bench, the Learned Counsel for the Respondent No. 1 admitted this e-mail was not replied to by the Operational Creditor. We find there is continuous exchange of e-mails between the Operational Creditor and the Corporate Debtor regarding the differences in the accounting entries and the final email exchanged is dated 25.05.2018, which is reproduced above at para 4, wherein the Corporate Debtor had clearly stated no amount is payable to M/s Satkar Logistics Pvt. Ltd. 12. On perusal of the reply to Section 8 notice, we find that Corporate Debtor had clearly stated no amount is due to the Operational Creditor. This Tribunal in order dated 16.08.2018 Company Appeal (AT) (Insolvency) No. 452 of....
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.... Limited, (2023) 3 SCC 229 has held that failure of reconciliation of accounts qualifies as a pre-existing dispute. The rejection of Section 9 application on the grounds of such "pre-existing dispute" was upheld. The relevant portion of the judgment is reproduced below : 55. In this context the meaning of the word "reconciliation" is to be looked into. Going by Black's Law Dictionary, 10th Edition, the apt meaning suitable to the situation in relation to accounting, reads thus: "an adjustment of amounts so that they agree, especially by allowing for outstanding items". It is submitted by the learned counsel for the respondent that such a reconciliation had not taken place and also that indisputably, DRS was not formulated and approved. The aforesaid facts revealed from Annexure 40 together with the stand taken by the respondent in the letter dated 04.01.2013 (Annexure 36) would reveal the existence of a pre-existing dispute between the parties. 56. In the contextual situation it is only apposite to be remindful of the observation in Mobilox Innovations that in doing the act of separating the grain from chaff the Court need not to be satisfied that the defence is likely to succ....
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....eased by the Corporate Debtor did not correspond to any particular PO but was released corresponding to consolidated amounts that was due. However, the Operational Creditor has cherry- picked particular invoices which was contrary to the business model and commercial understanding between the parties. Further there has been no reconciliation of accounts and prior to reconciliation of accounts, no default could have arisen. In support of their contention, it has been submitted by the Learned Counsel for the Respondent that the Hon'ble Supreme Court in the matter of Sabarmati Gas Ltd. v. Shah Alloys Ltd. (2023) 3 SCC 229 has held that the failure of reconciliation of accounts also qualifies as a pre-existing dispute between the parties in terms of Section 8 of the IBC Code. ....... ............. 9. The short point for consideration is whether there was any discernible pre-existing dispute surrounding the debt claimed to be due and payable by the Operational Creditor. 10. We find that the Corporate Debtor in its reply dated 08.08.2020 to the Section 8 demand notice had disputed both the quantum of operational debt and also deficiencies in respect of discharge of contractual ....