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Judgment
O R D E R
12.10.2022: Heard learned counsel for the Appellant. This Appeal has been filed against the order dated 15.07.2022 by which order the Adjudicating Authority has rejected Section 9 application filed by the Appellant.
The Appellant was engaged in the business of providing consultancy service inter alia of advising its clients on bidding in various Coal Mine Developer and Operator Tenders. The Appellant’s case is that various invoices were issued between April, 2017 to June, 2017 but only one payment was made by Cheques which was dishonoured and subsequently payment was made through RTGS. A letter dated 19.03.2019 was issued to the Corporate Debtor by the Operational Creditor demanding payment of Rs.1,24,69,143/-. The said letter was replied by the Corporate Debtor on 18.04.2019 denying the claim of the Appellant and raising grounds regarding deficiency in the service from Operational Creditor’s side. Subsequently, after receipt of the letter dated 18.04.2019 by the Corporate Debtor, Section 8 notice was issued on 17.05.2019 and thereafter Section 9 application has been filed, which has been rejected by the impugned order on the ground that there were pre-existing disputes between the parties. The Adjudicating Authority has relied on letter dated 18.04.2019 for holding that there is pre-existing dispute.
Learned counsel for the Appellant challenging the order contends that there was no grounds on basis of which it can be held that there was pre-existing dispute. He has relied on Para 51 of the Judgment of Hon’ble Supreme Court in “Mobilox Innovations (P) Ltd. vs. Kirusa Software Pvt. Ltd.”
We have considered the submissions of learned counsel for the Appellant and perused the record.
The letter dated 18.04.2019 is Annexed as Annexure-46 to the Appeal. After receipt of the demand by letter dated 13.03.2019 from the Operational Creditor it was promptly denied by the Corporate Debtor and refuting the claim following averments were made in Para 3-4:-
“3.It is further pertinent to mention here that you have failed to meet the good industry parameter as required and envisaged in the work order and therefore we hereby terminate all the work order with immediate effect. Additionally, the company is well within its rights to recover the amount that has already been paid to you in the guise of the services assured by you.
4.In this regard, it is further brought to your notice that the services promised and assured to be supplied as “deliverables” by you under the relevant work orders, on the milestone basis were never supplied and as such constituted deficiency in services from your side.”
When we look into the contents of the said Para 3 and 4, the Corporate Debtor has raised grounds regarding deficiency in service and it was also stated in Para 4 that the supply was on milestone basis and was never supplied and as such constituted deficiency in service. Further, the Corporate Debtor in Para 3 has clearly mentioned that all the work contracts with the Operational Creditor are terminated. Such issues having raised prior to issuance of Section 8 notice, the letter dated 18.04.2019 raises sufficient grounds for pre-existing dispute and the Adjudicating Authority did not commit any error in rejecting the Section 9 application relying on the said letter.
We do not agree with the submission of learned counsel for the Appellant that letter dated 18.04.2019 did not raise a dispute that truly exist in fact and the defence raised by the Corporate Debtor was a moonshine. The letter which was issued prior to the Section 8 notice was sufficient to indicate that there was a pre-existing dispute. We dismiss the Appeal. However, it will be open for the Appellant to approach such forum for recovery of any dues, if any, as is permissible as per law.