TaxTMI 
TaxTMI 
2025 (12) TMI 768
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....by the Appellant. 2. Coming to the factual matrix of the present case, the Corporate Debtor- Veira Electronic Pvt. Ltd. had entered into a business agreement with the Operational Creditor-NU-WORLD Industries (Pty) Ltd. for purchase, assembly and distribution of TV and Home-Audio products. In pursuance of the agreement, goods were supplied by the Appellant and invoices raised from 07.03.2019 to 21.05.2024. Against the invoices raised by the Operational Creditor to the tune of USD 798,247.40, the Corporate Debtor had cleared payment amounting USD 716,421.98 thus leaving an outstanding principal amount of USD 81,825.42 only. In terms of the business agreement between the two parties, the Corporate Debtor was also liable to pay interest @ 1.5% per month on the outstanding dues which worked out to an amount of USD 44,151.57. The interest amount coupled with the net principal totalling USD 125,976.99 thus remained outstanding and the said amount not having been cleared by the Respondent-Corporate Debtor, the Appellant issued a Section 8 Demand Notice on 26.06.2024. The Corporate Debtor did not either reply to the Section 8 Demand Notice nor did they release any further payment to the ....
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....There was no cogent reason on the part of the Adjudicating Authority for not taking into consideration the invoice dated 21.05.2024 by which the interest amount had been raised to hold that the Section 9 application did not fulfil the threshold limit. When there was a debt above Rs. 1 Cr which was due and payable, and part-payments thereto made from time to time, this amounted to be a clear acknowledgement of liability and hence a fit case for filing a Section 9 application which could not have been dismissed by the Adjudicating Authority. Assailing the impugned order, it was vehemently contended that the dismissal of the Section 9 application by outright rejection of the interest computation was incorrect and needs to be set aside. 5. Rebutting the contentions made by the Appellant, the Ld. Counsel for the Respondent submitted that the Adjudicating Authority had rightly rejected the Section 9 application on grounds of the application being non-maintainable as it did not meet the threshold limit of Rs. 1 Cr. It was asserted that the Appellant in the interest computation had added the interest amount which accrued on the invoices raised during the Section 10A embargo period which....
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....rpose of calculating the threshold as prescribed under Section 4 of the Code; and along with the interest charged thereupon. However, due to ambiguous charge of interest on ground of running account and relative payments, it is unclear to establish the computation of the interest charged on these invoices. ...... 15. It can be established from herein above that the invoices raised during 10A period have not been exempted for the purpose of calculation of interest charged thereupon, which is strictly against the intent of the said section. 16. As a result, this Adjudicating Authority has arrived at the conclusion that the invoice dated 21.05.2024 raised for the purpose of calculation of the interest would not be considered or involved for the purpose of ascertaining the amount meeting the minimum threshold in accordance with Section 4 of the Code." 9. We find from the above excerpts of the impugned order that it has been held at para 12 of the impugned order that for calculating the threshold limit, the invoices raised during the Section 10A period need to be segregated from those invoices not arising during the Section 10A period. It has further held a....
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....ent to INR 1,05,68,291.58 (as on date) 14. When we look at the above computation chart in Part-IV, we find that the interest calculation has been shown as USD 44,151.57. The basis of this interest calculation is admittedly the invoice dated 21.05.2024 as placed at page 112 of APB which depicts "Interest 36 months on the outstanding Balance 1.5% per month upto 21.05.2024" which is as reproduced below: "NU- WORLD GLOBAL INVOICE Invoice Date: 21 May 2024 Invoice Number: NWG - INV5001 Description Quantity Unit Price Amount USD INTEREST 36 MONTH STRAIGHT LINE ON OS BALANCE 1.00 44,151.57 44,151.57 Subtotal 44,151.57 TOTAL USD 44,151.57 Due Date: 21 May 2024 Beneficiary Name: NU-WORLD GLOBAL LIMITED" As already noted at para 9 above, the Adjudicating Authority held that the interest calculation on the basis of the invoice dated 21.05.2024 was not in order as it did not exclude interest on invoices which were hit by the Section 10A period embargo. 15. The Appellant has contended that it was misplaced on the part of the Adjudicating Authority to hold that the ....
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....unt along with Interest due and payable by the Corporate Debtor (C+D) INR 1,05,08,371.49/- 18. Before we make our observations on this fresh tabular chart of principal and interest computation placed before us by the Appellant by way of written submission after the matter was reserved for orders, we must add that this had not been placed before us by way of an affidavit, though an opportunity to do so was prayed for by the Appellant which had been allowed by this Tribunal on 13.10.2025. Be that as it may, for meeting the ends of justice, we have perused the fresh tabular chart on principal and interest computation. 19. It is critical for us to have a look at the invoice dated 21.05.2024, which is already reproduced above at para 14 above. Quite clearly, it is a cryptic invoice which is strikingly bald in terms of details. The said invoice seems to have been raised on the basis of a communication received by the Operational Creditor from their external independent auditor-Sino Corp CPA Ltd. dated 19.08.2024 which is placed at page 113 of APB. This communication inter alia states that the interest amount owed by the Corporate Debtor to the Operational Creditor is USD 44,151.....