Rajeswara Rao Vittanala, Member (Judicial):— The present Company Petition bearing CP (IB) No. 316/9/HDB/2017, is filed by Equipment Conductors of Andhra Pradesh Ltd. (Petitioner/Operational Creditor) U/s. 9 of Insolvency and Bankruptcy Code, 2016 R/w Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, by inter-alia seeking to initiate Corporate Insolvency Resolution Process (CIRP), in respect of Transmission Corporation of Andhra Pradesh (Respondent/Corporate Debtor).
2. The brief facts, as discerned from the pleadings of the parties, are as follows:—
(a) Equipment Conductors & Cables Limited, (Operational Creditor) is a small scale industry unit, which is into manufacturing of ACSR, AA Conductors and AAA Conductors for overhead power transmission lines.
(b) Transmission Corporation of Andhra Pradesh Limited (Corporate Debtor) is a Company incorporated under the Companies Act on 29.12.1998.
(c) In pursuance to Purchase order No. CEP/EP3/A1/CEBT-1851/95/PM-8817 dated 31 October 1995 issued by the Corporate Debtor to the Operational Creditor for supply of conductor/finished products, the Operational Creditor supplied goods in question. Aggrieved by non-payment of interest for delayed payments, Equipment Conductor & Cables/Supplier, the Operational Creditor, has filed claim against Transmission Corporation of AP/Corporate Debtor, before Haryana Micro and Small Enterprises Facilitation Council (HMSEFC for short) claiming an amount of Rs. 1,11,13,301/- upto 30.06.2011, which was subsequently revised to Rs. 5,58,64,041/- upto 31.01.2008 on account of interest for the delayed payment for the price of goods for items No. 1 to 82. Accordingly, HMSEFC has passed an award dated 21.06.2010 against the Corporate Debtor by declaring that as per provisions Act 32 of 1993, the Corporate Debtor herein is liable to pay interest at rate of interest and dates mentioned in the bills in respect of SI. 58-82 to actual date of payment with compounding, and remaining bills in question mentioned at Sl. No. 1 to 57 were declared as time barred by limitation Act, 1963.
(d) Aggrieved by the said Award dated 21.06.2010, the Operational Creditor has filed a petition before Addl. District Judge, Chandigarh, under Section 34 of the Arbitration and Conciliation Act, 1996 for setting aside of the Award dated 21.06.2010. The Additional District Judge, Chandigarh vide order dated 28.08.2014, for the reasons recorded therein, has set aside the impugned Award and thus remanded the matter back to the Arbitrator for fresh decision.
(e) Aggrieved by the above order dated 28.08.2014 of the Learned ADJ, Transmission Corporation of AP (Corporate Debtor) has preferred four Appeals/reviews bearing FA No. 10525 and 10507 of 2014 and FAO No. 34 and 68 of 2015 before the Hon'ble High Court of Punjab and Haryana, Chandigarh. After hearing the parties, the Hon'ble High court of P & H, has disposed off the appeals vide order dated 29 January, 2016 by interalia setting aside the order of ADJ remanding back the matter to the Arbitrator as referred to above with an observations that Objecting Court should determine 75 % of amount in question etc.
Aggrieved by said order, the Corporate Debtor has filed a clarification Petition CM. No. 5298-99-CH-2016 in FAO No. 10525 of 2014, under Section 151 of the Cr. PC for clarification in respect of adjudication of objections by objecting court U/s 34 of A & C Act, 1996 and in respect of setting aside of order to remand the matter back to the Arbitrator vide judgment dated 29.01.2016 in FAO No. 10525 of 2014 passed by the Hon'ble High Court of Haryana and Chandigarh. After hearing the case, the Hon'ble High Court vide its order dated 17 March, 2016 has dismissed the case with a cost of Rs. 75.0000/- by declining permission for withdrawal of Application.
(f) The Operational creditor/Decree holder has filed Execution Petition Sr.g No. 10950/2016, under Order XXI Rule 11 CPC R/w Section 151 of CPC for execution of judgment dated 29.01.2016 in FAO No. 105 of 2014 of P & H, and award dated 21.06.10 etc. before the Hon'ble Chief Judge, City Civil Court. Hyderabad. However, it was dismissed by an order dated 17.8.16.
Aggrieved by the order passed in EP dated 17.08.2016 made in EA No. 414 of 2016 in EP SR No. 10950, the Corporate Debtor has filed Civil Revision Petition bearing CRP No. 5334 of 2016 before the Hon'ble High Court of judicature at Hyderabad. After hearing the case, the Hon'ble High court was pleased to allow it by an order dated 8 November, 2016 by setting aside the order of Chief Judge, CCC, Hyderabad dated 17.08.2016 in EA No. 414 of 2016 in numbering the EPSR No. 10950 of 2016 as EP No. 50 of 2016 and passing the pro-consequential pro-order in EA No. 414 of 2016 was also set-aside holding the pro-order unsustainable and the very EP as not maintainable by dismissing the same for no enforceable award within the meaning of section 36 of the Arbitration Act to execute the same. And the Operational Creditor did not appeal against the said order before Higher Court and thus the orders passed on 08.11.2016 by Hon'ble High Court of Hyderabad has attained finality, and in turn the Award dated 21.06.2010 passed by HMSEFC in Award No. HMSEFC/2010/06 in case No. 3 in respect of claim/invoice Nos. 1 to 57 has also attained finality.
(g) The Operational Creditor, despite various orders passed by various courts/forums and attaining finality of the Award dated 21.06.2010 passed by the council in r/o claim invoices no. 1 to 57, has filed EP No. 217 on 18.03.2017, transferred to Honlale Commercial Court by orders of the Hon'ble Chief Judge and registered as CEP No. 31 of 2017, only to get the amount determined under order 21, Rule 17 of CPC, which is pending adjudication.
(h) The Operational Creditor has approached the Industrial Facilitation Council at Chandigarh for determination of the amounts in respect of Invoices No. 1 to 57 and also attaching the current accounts/cash credit accounts or any type of accounts of the Corporate Debtor and the same was dismissed vide Memo No. TS/HMSEFC/Case No. 3/15652-A dated 14.09.2017 holding that without determination of the interest amount, it is not feasible to secure the amount which has not been determined.
(i) The Operational Creditor, though raised various litigations before various forms, has got issued a demand notice dated 14.10.2017 under the provisions of IBC, 2016 by claiming an amount of Rs. 45,69,31,233/- And aggrieved by non-payment of interest on delayed payment, has filed the present Company petition, by seeking to initiate CIRP against the Corporate Debtor.
3. The Respondent, has opposed the instant Company petition filing a Counter dated 05.01.2018, which are further reiterated vide written arguments dated 23.01.2018, by inter-alia contending as follows:—
(1) The filing of the present Petition is nothing but abuse of process of law more particularly when the Arbitration Tribunal i.e. Haryana Micro Small Enterprise Facilitation Council (HMSEFC) has declared the claim Nos. 1 to 57 are hopelessly barred by Law of Limitation in Case No. 3 Award No. HMSEFC/2010/06, Dated: 21-06-2010. This Petition is filed by the Operational Creditor with an ulterior motive for by wrongful gain and by illegal means. It has cited the judgment of the Hon'ble Supreme Court in Mobilox innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd. and thus contended that where there is no admitted liability or when there are no orders passed by Adjudication Authority; this Hon'ble Court has no jurisdiction to entertain this petition. Therefore on this ground alone, the present Company petition is liable to be dismissed by imposing exemplary costs on Operational Creditor.
(2) The erstwhile Andhra Pradesh State Electricity Board which came into existence in 1959 was responsible for Generation, Transmission and Distribution of Electricity. Under Electricity Sector Reforms agenda, the then united Government of Andhra Pradesh promulgated Andhra Pradesh Electricity Reforms Act, 1998. The erstwhile APSEB was unbundled into one Generating Company (APGENCO), One Transmission Company (APTRANSCO) and Four Distribution Companies (APDISCOMs) as part of the reform process. APTRANSCO came into existence on 01-02-1999. From February, 1999 to June 2005 APTRANSCO remained as Single buyer in the state-Purchasing power from various Generators and selling it to DISCOMs. in accordance with the terms and conditions of the individual PPAs, at Bulk Supply Tariff (BST) rates. Subsequently in accordance with the Third Transfer Scheme notified by the united Government of Andhra Pradesh, AP Transco ceased to undertake power trading and has retained powers of controlling system operations of Power Transmission. The Corporate Debtor, is a Company incorporated and registered under the Companies Act 1956, on 29-12-1998.
(3) This Petition is filed by the Operational Creditor under Insolvency Proceedings for realization of the monies claim of which were held to be barred by Law of Limitation, by the Haryana Micro and Small Enterprises Facilitation Council, Chandigarh in Award No. HMSEFC/2010/06, in Case No. 3, Dated: 21-06-2010 and later by the Hon'ble Punjab and Haryana High Court in batch matters viz., FAO 10525 of 2014 by Orders Dated: 29-01-2016. Further said claim when brought before City Civil Court, Hyderabad, the same was held to be not sustainable through the Orders Dated: 08-11-2016 passed by the Hon'ble High Court at Hyderabad for the State of Telangana and for the State of Andhra Pradesh in CRP No. 5334 of 2016. Therefore the instant proceedings deserve to be dismissed in limini, being pre-mature and not maintainable. In fact the Operational Creditor has already filed E.P. No. 50 of 2016 purporting in pursuance of said orders in CRP 5334 of 2016 before the Hon'ble 2 Additional Chief Judge City Civil Court at Hyderabad under Order 21, Rule 17 C.P.C. to determine the amount in Case No. 3 Dated: 21-06-2010 in respect of Claim/Invoices Nos. 1 to 57, that was dismissed by Orders Dated: 20-01-2017.
(4) It has stated that the Corporate Debtor has issued Purchase Order No. CEP/EP3/A1/CEBT-1851/95/PM-8817, Dated: 31-10-1995, in favor of the Operational Creditor for supply of conductors and the Operational Creditor has supplied the said material on various dates and raised the bills (in respect of invoices bearing Nos. 1 to 57 as appended to the Award Dated: 21-06-2010 passed by the HMSEFC, in Case No. 3) on various dates and the Corporate Debtor has paid the entire invoices on various dates but with some delay, and the Operational Creditor has acknowledged the said amounts without any objections. However, the Corporate Debtor has filed the said above said arbitration proceedings before the Industrial Facilitation Council for payment of interest for the delayed period, in respect of invoices Nos. 1 to 82 under the provisions of Interest on Delayed Payments Act. The said Council, after hearing both the parties, has passed the Award Dated: 21-06-2010 whereby it has dismissed the claim of the Operational Creditor in respect of invoices Nos. 1 to 57 as hopelessly barred by the provisions of the Limitation Act 1963, and allowed the claim Nos. 58 to 82, by Orders Dated: Dated: 21-06-2010.
(5) The Operational Creditor being aggrieved by the said Award Dated 21-06-2010 passed by the Council in respect of dismissal of claims/invoices mentioned at Serial Nos. 1 to 57 of the said Award has filed Arbitration Case No. 361 of 2010 before District Court at Chandigarh, for modifying the said Award and allow the original claims filed by it before the Arbitration Council. The said Hon'ble District Court at Chandigarh by Orders Dated: 28-08-2014 has remanded the said case back to the Arbitrator (Council) for fresh decision. Aggrieved by the said Order Dated: 28-08-2014, passed by the District Court at Chandigarh, the Corporate Debtor filed F.A.O. No. 10507 of 2015 and other cases before the Hon'ble High Court of Punjab and Haryana, where in the said Honfale High Court passed order Dated: 29-01-2016 holding that order of the District Judge, Chandigarh in remanding back the matter to the Council is set aside. As such the order passed by Facilitation Council attained finality in respect of claim/invoice Nos. 1 to 57. Not with standing with it, the Operational Creditor, has filed a Clarification Petition vide CM. No. 5298-99-CII-2016 before the said Hon'ble Punjab and Haryana High Court, but the same was dismissed by Hon'ble High Court, by Orders Dated: 17-03-2016 by imposing heavy costs for Rs. 75,000-00. Thus the Order Dated: 21-06-2010, passed by the Council attained finality. As such till date there is no Executable Decree in respect of invoices of Serial Nos. 1 to 57 of the said Award.
(6) It is contended that the Operational Creditor by suppressing all the above said facts, has filed E.P.S.R. No. 10950 of 2016 before the Hon'ble Chief Judge, City Civil Court at Hyderabad (which was later made over to Hon'ble 2 Additional Chief Judge City Civil Court and the same was re-numbered as E.P. No. 50 of 2016) claiming for execution of the Award Dated: 21-06-2010, passed by the Council in Award No. HMSEFC/2010/06 in Case No. 3 together with and the Orders Dated: 28-08-2014 passed by the Additional District Judge at Chandigarh in Arbitration Case No. 361 of 2010 in respect of all the claims/invoices at serial Nos. 1 to 82 including claims 1 to 57 already held to have barred by Law of Limitation. The O.C. has filed the said E.P. inspite of the fact that the dismissal of the claims/invoices Nos. 1 to 57 by the Arbitration Council as hopelessly barred by the Limitation Act 1963, which order was later confirmed by Common Orders Dated: 29-01-2016 passed by the Hon'ble Punjab and Haryana High Court at Chandigarh in FAO No. 10507 of 2014 and batch cases, wherein the Order Dated: 28-08-2014 passed by the Additional District Judge at Chandigarh in Arbitration Case No. 361 of 2010 in remanding back the matter to the Council for fresh disposal, was set aside. The Corporate Debtor having come to know about the filing of the said E.P. Sr. No. 10950 of 2016 appeared in the said case and filed its Objections Dated: 10-08-2016, contending that the said E.P. S.R. No. 10950 of 2016 filed by the Decree Holder is not maintainable and the same is liable to be dismissed in limini being wholly misconceived. But the Hon'ble Chief Judge, City Civil Court, Hyderabad without adhering to the objections filed by the Corporate Debtor, has registered the same as E.P. No. 50/2016. Aggrieved by the Orders Dated: 17-08-2016 passed by the Hon'ble Chief Judge CCC Hyderabad in E.A. No. 414 of 2016 in E.P. Sr No. 10950 of 2016 (which was later numbered as E.P. No. 50 of 2016) has filed CRP No. 5334 of 2016 before the Hon'ble High Court of Judicature for the State of Telangana and for the State of Andhra Pradesh and the Hon'ble High Court at Hyderabad, by Orders Dated: 08-11-2016, has allowed the said CRP and held that “there is no enforceable award to execute under Section 36 of the Arbitration Act from the arbitration proceeding so far as the claim of items 1 to 57 is concerned for what arbitrator held the claims as barred by law and the objecting court-cum-arbitration court in A.C. No. 361 of 2010 even held not barred by law, did not determine, but for remanded to re-determine in this regard and same was even questioned in review the review petition was dismissed and other side when questioned what was held by the High Court is that remanded is not correct for lack of jurisdiction, thereby practically for re-determination and once it is not re-determined, there is no award and when there is no award, there is no question of execution and when there is no question of execution, there is no question of entertaining the unnumbered E.P. much less to number the same or even to pass any consequential pro-order that are impugned in the revision. Accordingly and in the result, the revision is allowed by setting aside the order of the Chief Judge, CCC, Hyderabad Dated: 17-08-2016 in E.A. No. 414 of 2016 in numbering the E.P.S.R. No. 10950 of 2016 as E.P. No. 50 of 2016 and passing the consequential pro-order in E.A. No. 414 of 2016 is set-aside holding the pro-order is unsustainable and the very E.P. is not maintainable by dismissing the same for no enforceable award within the meaning of Section 36 of the Arbitration Act to execute”.
7. In view of the above said Orders Dated: 08-11-2016 passed by the Hon'ble High Court at Hyderabad in CRP No. 5334 of 2016 the above said E.P. No. 50 of 2016 was dismissed by Orders Dated: 20-01-2017 by the Hon'ble II Additional Chief Judge City Civil Court at Hyderabad. Since the Operational Creditor did not prefer or carry the matter in Appeal before higher courts the Orders Dated: 08-11-2016 passed by the Hon Tale High Court at Hyderabad and thus it has attained finality and in turn the Award Dated: 21-06-2010 passed by the Haryana Micro and Small Enterprises Facilitation Council, Chandigarh, in Award No. HMSEFC/2010/06, in Case No. 3, in respect of claim/invoice Nos. 1 to 57 which were held as hopelessly barred by the Limitation Act 1963 has also attained finality. In spite of the above said clear orders passed by various courts/forums and attaining finality of the Award Dated: 21-06-2010 passed by the council in respect of the claim/invoices Nos. 1 to 57, the Operational Creditor has filed the E.P. No. 217 of 2017 which is transferred to the Hon'ble Commercial Court by orders of the Hon'ble Chief Judge which was registered as C.E.P. No. 31 of 2017, only to get the amount determined under order 21, rule 17 C.P.C. Thus the O.C. has approached the City Civil Court with unclean hands and suppressed the above said material facts and trying to mislead the Hon'ble Court and also trying to execute the Award where there is no decree for payment of any money is passed (in respect of the claims/invoice Nos. 1 to 57 which were held as hopelessly barred by the Council and the same were attained finality), and the said action of the Operational Creditor virtually amounts to misrepresentation knowing full well that the decree under the above said C.E.P. No. 31 of 2017 is not executable.
8. The Operational Creditor has approached the Industrial Facilitation Council at Chandigarh for determination of the amounts in respect of the Invoices Nos. 1 to 57 and also for passing of orders for attaching the current accounts/cash credit accounts or any type of accounts of the CD herein. The said Council has dismissed the application of the O.C. vide Memo No. TS/HMSEFC/Case No. 3/15652-A, Dated: 14-09-2017, holding that the “Council was of view that without determination of the interest amount (for which the Council is not competent as per Advocate General, Haryana), it is not feasible to secure the amount which has not been determined. Further the Arbitration and Conciliation (Amendment) Act, 2015 have prospective effect, not retrospective effect. Therefore, the prayer made by the Applicant for securing the determined amount in dispute in the Arbitration Award is not maintainable”.
9. The Operational Creditor not satisfying with the said orders/Awards passed by various forums, has initiated the present proceedings by claiming falsely that Corporate Debtor was due to pay a sum of Rs. 45,69,31,233/- till 30-09-2017, in respect of the Invoices Nos. 1 to 57, wherein different forums have held that the claims Nos. 1 to 57 are barred by Law of Limitation. In respect of another case No. 4, where the Industrial Facilitation Council held that all claims are barred by Law of Limitation, which was affirmed by High Courts, was upheld by Hon'ble Supreme Court vide orders dated 06.05.2016 in SLP(C). No. 8291 of 2016.
10. The Operational creditor got issued the Demand Notice Dated: 14-10-2017 through its Advocate based at Delhi, which is against the spirit of Section 8 of the I & BC Code 2016. Nowhere in the said, demand notice it is stated that the said Advocates are issuing the demand notice on the authorization/Board resolution passed by the directors of the Operational Creditor and the Scrutiny Officer of this Hon'ble NCLT has taken an objection to that effect. It appears that the Operational Creditor has prepared the said alleged Board resolution ante dated and filed the same in the replies made by it to the objections raised by the Scrutiny officer so as to get the same registered. Except stating that we have been retained by our aforesaid client, in the said Demand Notice issued by the Advocate, nothing has been stated about the date of the alleged resolution. Therefore, it is contended that the Operational Creditor has not passed any resolution much less the alleged board resolution Dated: 27-09-2017 and the alleged resolution is brought up only after an objection is raised by the scrutiny officer of this Hon'ble Tribunal.
11. The Registry also raised an objection as to the date of default of the amount claimed and the Operational Creditor without answering the said query, in its submissions has stated that the award has attained finality by the disposal of Sec. 37 Application vide Judgment Dated: 29-01-2016 in FAO No. 10507 of 2014, which is absolutely incorrect. As stated supr, the order passed in CRP the Hon'ble High Court of Andhra Pradesh and Telangana at Hyderabad has categorically stated until then there is no executable decree. Subsequently, there is no order by any court fastening any liability to this CD.
12. The Corporate Debtor submits that there is neither any liability, nor there is any enforceable decree/award passed by an any forum/court/tribunal in respect of the alleged invoice Nos. 1 to 57 of the Award Dated: 21-06-2010 passed by the Council. The Operational Creditor has approached this Hon'ble Tribunal with unclean hands by misrepresenting and suppressing the material facts.
13. The Corporate Debtor further submits that the Hon'ble Supreme Court in Mobilox innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd. vide its orders categorically held that where there is no admitted liability or when there is no orders by adjudicating authority, this Hon'ble Court has no jurisdiction to entertain this petition. Therefore on this ground alone, the present C.P(I.B) No. 316/HDB/2017 to be dismissed by imposing exemplary costs on the Operational Creditor.
They have also relied upon the Hon'ble Supreme Court of India order dated 15.12.2017 in the matter of Macquarie Bank Limited v. Shilpi Cable Technologies Ltd. in Civil Appeal No. 15135 of 2017.
Therefore, it is urged the Tribunal to dismiss the instant Company petition with exemplary Costs.
4. The case was listed for admission on various dates viz., 06.12.2017, 12.12.2017, 19.12.2017, 10.01.2018, 17.01.2018, 21.03.2018, 05.03.2018 and reserved for orders on 06.03.2018.
5. Heard Ms. Asma Raja, Learned Counsel for the Petitioner and Shri Dammalapati Srinivas, Learned Advocate General for the State of Andhra Pradesh & Senior Advocate with Shri B. Harinath Rao, for the Respondent.
6. The learned Counsel for the Petitioner, while reiterating various grounds raised in the Company petition and reading various orders/judgments passed by various judicial fora, has relied upon the following judgments in support of the petitioner.
(1) Modern Industries v. Steel Authority of India, Hon'ble Supreme Court of India order dated 15.04.2010 in Civil Appeal Nos 3305-3306 of 2010.
(2) State of Haryana v. S.L. Arora and Company, Hon'ble Supreme Court of India order dated 29.01.2010 in Civil Appeal No. 1094 of 2010.
(3) Annapurna Infrastructure Pvt. Ltd. v. Soril Infra Resources Ltd., Hon'ble NCLAT order dated 24.03.2017 in Company Appeal (AT) (Insolvency) No. 32 of 2017.
(4) Ksheeraabd Constructions Pvt. Ltd. v. Vijay Nirman Company Pvt. Ltd., Hon'ble NCLAT order dated 20.11.2017 in Company Appeal (AT) (Insolvency) No. 167 of 2017.
(5) Kirusa Software Pvt. Ltd. v. Mobilox Innovations Pvt. Ltd., Hon'ble NCLAT order dated 24.05.2017 in Company Appeal (AT) (insolvency) 6 of 2017.
(6) Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd., Hon'ble Supreme Court order dated 21.09.2017 in Civil Appeal No. 9405 of 2017.
(7) Paramjeet Singh v. Maxim Tubes Company Pvt. Ltd., Hon'ble NCLAT order dated 20.11.2017 in Company Appeal (AT) (Insolvency) No. 150 of 2017.
(8) International Road Dynamics South Asia Pvt. Ltd. v. Reliance Infrastructure Limited, Hon'ble NCLAT order dated 01.08.2017 in Company Appeal (AT) (Insolvency) No. 72 of 2017.
(9) Labdhi Enterprises v. Baramati Agro Pvt. Limited, Hon'ble NCLAT order dated 10.11.2017 in Company Appeal (AT) (Insolvency) No. 195 of 2017.
(10) Sanjay Bagrodia v. Sathyam Green Power Pvt. Ltd., Hon'ble NCLAT order dated 15.11.2017 in Company Appeal (AT) (Insolvency) No. 193 of 2017.
(11) Sak Industries Pvt. Ltd. v. Fenance Auto Ltd., Hon'ble NCLAT order dated 15.11.2017 in Company Appeal (AT) (Insolvency) No. 201 of 2017.
The learned counsel for the petitioner, has therefore urged the Tribunal that the instant Company petition fulfills all the criteria prescribed under section of 9 of IBC so as to admit the case and pass all consequential orders of moratorium etc.
6. Shri Dammalapati Srinivas, the Learned Advocate General, has again reiterated various averments made in his counter as adverted supra and also filed written gist of his arguments, which are briefly stated supra. The Learned Senior Counsel, therefore, urged the Tribunal to dismiss the Company petition with costs as it is frivolous and abusing the process of law.
7. The Company petition is filed under the provisions of Section 9 of Insolvency and Bankruptcy Code, 2016. The parameters/conditions required to be fulfilled for admission or otherwise are dealt with under Section 9(5)(i) & (ii), which are extracted below:
9(5) The Adjudicating Authority shall, within fourteen days of the receipt of the application, under sub-section (2), by an order — (i) admit the application and communicate such decision to the operational creditor and the corporate debtor if, — (a) the application made under sub-section (2) is complete; (b) there is no repayment of the unpaid operational debt; (c) the invoice or notice for payment to the corporate debtor has been delivered by the operational creditor; (d) no notice of dispute has been received by the operational creditor or there is no record of dispute in the information utility; and (e) there is no disciplinary proceeding pending against any resolution professional proposed under sub-section (4), if any.
Application for initiation of corporate insolvency resolution process by operational creditor.
(ii) reject the application and communicate such decision to the operational creditor and the corporate debtor, if — (a) the application made under sub-section (2) is incomplete; (b) there has been repayment of the unpaid operational debt; (c) the creditor has not delivered the invoice or notice for payment to the corporate debtor; (d) notice of dispute has been received by the operational creditor or there is a record of dispute in the information utility; or (e) any disciplinary proceeding is pending against any proposed resolution professional: Provided that Adjudicating Authority, shall before rejecting an application under subclause (a) of clause (ii) give a notice to the applicant to rectify the defect in his application.
8. On perusal of the rival contentions made by the parties, as briefly mentioned supra, the main issue to be considered in the instant case is whether notice of dispute has been received by the Operational Creditor for the dispute raised in the Company petition or there is a record of dispute in the Information Utility as per Section 9(5)(ii). It is a settled position of law by various judgments rendered by the Hon'ble Supreme Court and Hon'ble NCLAT as stated supra, and especially Mobilex judgment laid proposition of law. As stated supra, there is a long history of case, and it has suffered several orders. The Claim as stated supra, ultimately runs into two parts S. No. 1 to 57 and 58 to 82. So far as claim regarding to S. No. 1 to 57 is concerned; it is settled ultimately by virtue of the orders passed by CRP No. 5334 of 2016 before the Hon'ble High Court of Judicature for the State of Telangana and for the State of Andhra Pradesh and the Hon'ble High Court at Hyderabad, in CRP No. 5334 of 2016 vide its Orders dated: 08-11-2016 and the claim with regard to other bills was admittedly to be under disputed as detailed supra. Moreover, the Company petition itself suffers various fundamental defects as pointed out by the learned Advocate General for the respondents in the reply as stated supra. Therefore it is to be held that there is a valid dispute rather no dispute as issue in question was substantially dealt with by various Courts as mentioned supra. Therefore, the Company petition is not maintainable as per law declared by the Hon'ble Supreme Court in various judgments as mentioned supra. Therefore, the Company is liable to be rejected.
9. The Adjudicating Authority cannot go into disputed question of debt and default, and whether the debt and default with regard to the claim arises or not, is the point for consideration. In the instant case, as stated supra, payment of interest on delayed payment on principal amount has suffered so much litigation ending with order dated 8.11.2016 passed in CRP No. 5334 of 2016 by the Hon'ble High court for the states of AP and of Telangana. Therefore, the present Company petition also do not fulfill the conditions prescribed under section 9(5)(i) to admit the case, and, thus, it is liable to be rejected under Section 9(5)(ii) of IBC, 2016. And the petitioner was given ample opportunity duly following principles of natural justice as detailed supra.
10. In view of the facts and circumstances of the case, the Company petition bearing CP (IB) No. 316/9/HDB/2017 is hereby rejected. However, this order will not preclude the Petitioner to pursue the remedies available to it, under any law before other courts. No order as to costs.