Gulshan Kumar Raman Kumar vs Gromet India Private Limted

The Applicant inter-alia issued various invoices towards the supply of C R Sheets and Iron Sheets as a part of business transactions with the Respondent. The Applicant has been maintaining a running account of Respondent. The total amount of invoices raised during the Financial Year 2017-2018 from 07.07.2018 to 06.12.2017 is Rs. 61,62,846/- out of which an amount to the tune of Rs. 41,83,773.62/- remained due and payable.

Also in view of the business relationship existing between the Applicant and the Respondent, the Respondent further issued invoices in the name of the Applicant whereby the supplies of scrap materials were effected and the total amount of the said invoices was accordingly adjusted in the ledger account statement of the Respondent Company. The Applicant issued invoices for the said sale from 09.08.2017 to 06.12.2017 for a total amount of Rs. 2,24,070.20/-

Moreover, the Applicant also made payments to the Respondent in the form of financial assistance to the Respondent in the FY 2017-2018 for a total amount of Rs. 17,95,000/- iv. The Respondent in the said Financial Year (and also till date) against the said transactions has paid an amount of Rs. 35,50,000/-, which has been duly accounted in the books of the Applicant.

Moreover, as the aforementioned pending amounts were not paid by the Respondent a contractual interest of Rs. 12,54,006.69/- was debited by the Applicant in its books to be paid by the Respondent, and after adjustment of the aforementioned transactions, INR 54,37,782.49/- remained due, outstanding and payable by the Respondent and since the same was not paid despite the repetitive reminders and which shall be deemed to be operational debt under Section 5(21) of the Code for the purpose of the present proceedings at the relevant date. The Applicant issued the demand notice dated 16.05.2019 as per the Code which was duly served on the Respondent. The Respondent replied to the said demand notice vide letter dated 07.06.2019, however, the same is based upon false and concocted facts and is unreasonable and bogus in nature.

Therefore, the Applicant has filed this application under the Code.

It is submitted that the present application/petition is not maintainable on the ground that Gulshan Kumar Raman Kumar is the proprietorship firm and has no legal entity on its own and no petition/application can be filed by the firm namely Gulshan Kumar Raman Kumar upon the Respondent. This present application/petition scores dismissal on this ground alone as the present petition/application has been filed by the firm namely M/s Gulshan Kumar Raman Kumar and not by its proprietor Mr. Raman Sethi.

It is submitted that the present Applicant in its entirety is a result of arbitrary, manipulated, forged and fabricated bills and documents and discriminatory and monopolistic tactics resorted to by the applicant.

That the Applicant was in business with the Respondent in the year 2014 but due to the various unfair trade and malpractices adopted by the Applicant including raising exorbitant charges without the consent of the Respondent which were not compatible with the market rate, giving defective goods etc., the Respondent have stopped the business relationship with the Applicant.

It is submitted that there is no fair market practice at all on the part of the Applicant and on further scrutiny it came to the knowledge of the respondent that the Applicant have levied interest of 3% per month upon the bills/invoices no.131, 134, 140, 143 148 155, 162, 163, 169, 170, 174, 175, 176, 178, 182, 185, 192, 193, 198 and 212 without the knowledge, prior intimation or any agreement with the Respondent. It is submitted that the second copy of invoices mentioned above submitted to the Respondent do not contain any such stipulation that the Respondent is liable to pay the interest of 3% p.m. to the Applicant nor the same has ever been agreed by the Applicant at any point of time. It is further submitted that even otherwise, it has never been agreed by the Respondent to pay the Applicant the rate of interest of 3% per month as alleged by the Applicant.

It is further submitted that there has been no agreement between the Applicant and the Respondent that the Respondent is liable to pay the interest @3% per month to the Applicant as alleged.

It is further submitted that no loan/advances was given by the Applicant to the Respondent for the sum of Rs. 17,95,000/- as alleged. It is submitted that in fact, it was the Respondent who has been making advance payments to the Applicant but the Applicant had been incapable of supplying goods to the Respondent from time to time and has also been supplying defective goods not to the full sense of satisfaction to the Respondent and the Respondent has been issuing debit notes for the same to the Applicant time and again.

That the details of the advance payment made by the Respondent to the Applicant for which the Applicant was unable to supply goods to the Respondent are as under:-

The statement of loss and damages charges occurred due to deficiency of services regarding non supply of raw material by the Applicant to the Respondent showing the debit balance of Rs. 14,42,469/- in favour of the operational debtor is also annexed.

It is submitted that the averment challenging maintainability of the present Application on the ground that Gulshan Kumar Raman Kumar is a proprietary concern and the same cannot file the present petition in the said capacity before the Hon'ble Tribunal, is totally misconceived and misconstrued by the Respondent herein. The Respondent has failed to appreciate the fact that the present petition has been filed in the name of the proprietary concern, Gulshan Kumar Raman Kumar, through its proprietor Mr. Raman Seth which can be further discerned from the Cause Title of the present application as well as the Memo of Parties annexed thereto.

It is worth mentioning here that, as admitted by the Respondent itself, the applicant has been in business with the respondent since 2014 and it is for the first time under the present reply such alleged grievances, as mentioned above, have came to be heard from the respondent by way of Reply to Applicant's petition u/s 9 IBC, 2016. Needless to state that the said objections/ submissions were not even made in response to the notice issued by the Applicant under Section 8 IBC. There were no communications, either oral or written, from the Respondent till date alleging the facts as stated above relating to exorbitant prices and defective goods supplied by the Applicant to the Respondent and therefore, these are nothing but an afterthought of the Respondent whereby the Respondent is trying to shrug off its liability of paying the actual amount of debt due to the Applicant in view of the unpaid invoices.

Assuming the contentions of the Respondent to a gospel truth also, if the Debit note of Rs. 2,75,508/- issued by it in the year 2016-2017 (on 10.02.2016) is deemed to be correct, there ought to have been a debit balance atleast qua that amount in the books of account of both of the parties, which otherwise was never the case. As per the audited books of accounts, neither any amount against the said Debit notes was ever mentioned nor was any proceedings / correspondences also initiated by it to recover the said amount, which ultimately leads to the conclusion that the insertion of the said amounts in the statement is only an afterthought.

It is vehemently stated that the Applicant sometime after the introduction of the GST regime has been issuing invoices with clear stipulation of interest payable upon the late payments made there under. Also, since the invoices issued to the Respondent by the Applicant also did contain the very same stipulation, hence, it was always within the knowledge of the Respondent that the said GST invoices contain specific stipulation regarding the interest to be charged, as quoted herein, “Interest @3% p.m. shall be charged if not paid in 30 days”, which was categorically provided at the bottom of all the above stated invoices. However, despite being aware of the fact that interest @3% p.m. accrued from the date of default in the payment of the aforesaid invoices raised towards the supply of goods by Applicant, the respondent has not only deposed falsely of not being aware about the interest being charged but has also tried to manipulate the facts in its favor by deleting or erasing the specific stipulation for interest to be charged in the copies of the invoices placed by the Respondent on record along with its reply which again are doctored, manipulated, created and crafted and are not the genuine copies of the invoices issued by the Applicant herein. A bare comparison of the copies of aforementioned invoices, especially the stamp of the Applicant and the signatures, placed by the Respondent on record alongwith the reply clearly indicate that the same are fudged, manipulated and forged documents. The sheer mismatch of the size of the stamp, margins/ outline of the invoices categorically reveals that the very same stamp has been misused by the Respondent to create this false illusion.

Had there been an issue of untimely supply of material or defective goods, no further purchases or payments would not have been made on the part of the Respondent to the Applicant. Furthermore, issuance of the alleged Debit Notes was never intimated to the Applicant and there is no acknowledgment in the debit notes to impute knowledge of existence of the same to the Applicant and no other document has been placed on record to support the allegations of the Respondent.

The perversity in the actions of the Respondent and the fabrication of the documents filed along with the reply before this Hon’ble Tribunal is writ large and is evident by bare perusal of the following documents:

The ledger balances placed on record by the Respondent along with its reply is also manipulated and does not reflect the true ledger balances between the parties. It is stated that the Respondent by inserting the unknown, unacknowledged and fabricated debit notes has intentionally tampered the true and correct accounts which cannot be the basis for defence under the present reply. The true, correct and genuine ledger statement of the parties reflecting the correct state of financial affairs for the year 2014-15, 2015-2016 and 2016-2017 are placed as Annexure- 1(colly.) annexed to the present rejoinder. The copy of the ledger for the year 2017-2018 has been filed along with the petition itself.

It is also very surprising to note that the Respondent on one hand is alleging under Para 12 of its reply that it had advanced money to the Applicant in the year 2016-2017 and against which the Applicant could not supply the goods but at the same time it is also a case of the Respondent itself that it has been regularly trading with the Applicant not only in the said year but also in the later financial year 2017-2018 as well but yet no effect was given by it to them i.e. the Respondent has been purchasing goods regularly from the Applicant and has been making the due payments except against the invoices from 07.07.2017 to 06.12.2017.

The Respondent to avoid its liabilities towards the Applicant has fabricated the debit notes and the same are summarized as under:

It is further to note that the aforementioned Debit notes as per the contention of the Respondent itself is totaling to Approx. Rs. 18,70,005.68/-, and the only purpose of fabricating and placing them on record at this belated stage is to dispute the amount of Rs. 17,95,000/-paid to the Respondent.

A bare perusal of the Statement placed at Annexure – C (Page 19-20) as well the ledger statement for the FY 2017-2018 also forming part of the said Annexure and placed at Page No. 24-26 categorically mentions the admission as to the outstanding balance atleast of Rs. 23,13,770/- and 23,13,172/- respectively payable by the Respondent to the Applicant which vindicates the case of the present applicant.

Furthermore, the whimsical and arbitrary conduct of the Respondent is also evident from the fact that the Respondent in and around the month of April 2019 had issued three post dated cheques to the Applicant Company for a sum of Rs. 9,00,000/-, 22,50,000/- and 20,00,000/- bearing Cheque nos. 001055, 001054 and 001053 respectively each dated 09.05.2019 totalling to Rs. 51,50,000/-. Significantly, the said cheques were also issued against the unpaid principal operational debt of Rs. 41,83,775.80/- and the interest calculated thereupon till date of Rs. 12,54,006.69/- till 30.04.2019. It is stated that if the said amount of Rs. 41,83,775.80/- along with the said interest of Rs. 12,54,006.69/- totaling to Rs. 54,37,782.49/- was never due and payable, and also the interest was not agreed to the paid over the invoices @ 3% as mentioned above, there was no occasion for the Respondent to issue cheques for an amount of Rs. 51,50,000/- in the month of April 2019 with date as 09.05.2019.