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Judgment
O R D E R
Per: Justice Rakesh Kumar Jain:
This appeal is against the order dated 25.09.2023 passed by the Adjudicating Authority (National Company Law Tribunal, Division Bench-I, Chennai) by which an application filed by the Operational Creditor against the Corporate Debtor under Section 9 of the Insolvency and Bankruptcy Code, 2016 (in short ‘Code’) for initiation of the Corporate Insolvency Resolution Process (in short ‘CIRP’) has been admitted.
In brief, the Operational Creditor claimed an amount of Rs. 20,69,035/-as on 26.09.2019 on the basis of three invoices, namely, (i) Invoice No. RCT/YN/0046 dated 14.04.2019 for a sum of Rs. 4,24,042/- (ii) Invoice No. RCT/YN/0060 dated 17.04.2018 for a sum of Rs. 11,40,300/- and (iii) Invoice No. RCT/YN/0108 dated 30.04.2018 for a sum of Rs. 11,47,743/-. The aggregate of the above three invoices comes to Rs. 27,11,085/- but it is alleged that the Operational Creditor gave a credit of Rs. 9,50,250/- on account of return of yarn, therefore, he claimed Rs. 17,60,835/- towards the principal amount and Rs. 3,08,200/- towards interest calculating it @ 15% p.a.
The Operational Creditor served a demand notice on 06.09.2019 demanding a sum of Rs. 20,69,035/-. The Adjudicating Authority admitted the application and made the following observation in the impugned order at Para 9 and 10 which are as under;-
“9.In the instant case, it is seen from the record that the CD has not placed any documents to show that the yarn returned by the CD is to the tune of Rs. 27,11,085/-. The CD in reply to the demand notice has not made a whisper about the return of yarn and has only stated that there were certain oral communications made by the parties in relation to the quality of the yarn supplied by the OC.
10.Further, from the record of proceedings dated 04.08.2023, it is seen that both the parties had requested time to reconcile their accounts, however it never fructified.”
Aggrieved against the order of admission, the present appeal has been preferred by the Appellant who is the director cum shareholder of the Corporate Debtor.
Counsel for the Appellant has argued that since the yarn was returned, therefore, the dispute was raised and in view of the pre-existing dispute, the application could not have been admitted.
We have heard Counsel for the Appellant at length and after examining the record are of the considered opinion that there is no merit in his contention in view of the findings recorded in Para 9 and 10 of the impugned order where it has been held that there is no evidence brought on record by the Corporate Debtor that yarn was returned to the tune of Rs. 27,11,085/- and that the Corporate Debtor did not raise any issue of return of yarn in the reply to demand notice and has only relied upon the oral communications.
In such circumstances, there is hardly any merit in the appeal and the same is hereby dismissed. No costs.