Intertex Pvt. Ltd vs Electrotherm (India) Limited

This Company Petition is filed on 19.07.2025 by the Applicant – Intertex Private Limited (hereinafter referred to as ‘Operational Creditor’) against the Respondent – Electrotherm (India) Limited (hereinafter referred to as ‘Corporate Debtor’) under Section 9 of the IBC, 2016 read with Rule 6 of the IB (AAA) Rules, 2016 for initiation of CIRP, appointment of IRP and declaration of moratorium for default in payment of operational debt of Rs. 19,02,97,336.41/-, being the amount due and payable by the Corporate Debtor towards supply of goods, along with applicable interest, as detailed in the Petition.

On perusal of Part-I of Form-5, it is revealed that the Petitioner – Intertex Private Limited, a company incorporated under the provisions of the Companies Act, is having its registered office at 384-M, Dabholkarwadi, 4th Floor, Room No. 12, Kalbadevi Road, Mumbai – 400002. The Petitioner, being a company, is having CIN: U17120MH1982PTC028909.

On perusal of Part-II of Form-5, it is revealed that the Respondent – Electrotherm (India) Limited, bearing CIN

Number: L29249GJ1986PLC009126, is a company incorporated on 29.10.1986, having its registered office at A-1, Skylark Apartment, Satellite Road, Ahmedabad – 380015, Gujarat, India, as evidenced from the material on record. The Respondent’s authorised share capital is Rs. 78,59,00,000/-, and its paid-up share capital is ₹24,74,28,140/-, as reflected in the said Master Data.

On perusal of Part-III of Form-5, it is revealed that the Petitioner has not proposed the name of any Interim Resolution Professional for appointment as IRP under Section 13(1)(c) of the IBC, 2016, and the relevant particulars in respect thereof are stated as “NA” in the application.

On perusal of Part-IV of Form-5, it is revealed that the total amount of operational debt due and payable by the Respondent/Corporate Debtor to the Petitioner/Operational Creditor is ₹19,02,97,336.41/- (Rupees Nineteen Crore Two Lakh Ninety-Seven Thousand Three Hundred Thirty-Six and Forty-One Paise Only) as on 11.02.2023, being the date of default. Part IV provided other information: -

Details of seven purchase orders mentioning PO No., PO date, Payment date, and PO values. This shows purchase orders were place during the period 13.10.2022 to 05.11.2022.

The payments were to be made within 30 days of the date of invoice.

A total of 274 invoices were raised in the period 19.10.2022 to 11.01.2023 for amounts totalling to Rs 19,07,35,840.63 and payment of Rs 4,38,504.22 was received and balance amount due was Rs 19,02,97,336.41. The date of default for the present application is stated to be 11.02.2023.

The Operational Creditor is engaged in the business of trading and supply of goods, including iron ore pellets and lam coke, and during its business dealings, the Corporate Debtor approached the Operational Creditor from time to time for procurement of such goods.

The Corporate Debtor placed various purchase orders upon the Operational Creditor on different dates, inter alia including purchase orders dated 13.10.2022, 17.10.2022, 18.10.2022, 28.10.2022, 03.11.2022 and 05.11.2022, specifying the description of goods, quantity, price, delivery terms, and other commercial conditions. It was expressly agreed between the parties that payment against the invoices raised pursuant to such purchase orders shall be made

within 30 days from the date of invoice. The said purchase orders form the basis of the contractual relationship between the parties and are annexed herewith and marked as Annexure-I (Colly).

It is further submitted that in pursuance of the aforesaid purchase orders, the Operational Creditor duly supplied the goods to the Corporate Debtor from time to time and raised various invoices in respect thereof during the period from 19.10.2022 to 11.01.2023, clearly reflecting the invoice number, date, due date and amount payable. The due dates of the invoices were calculated in accordance with the agreed credit period of 30 days. The details of such invoices, along with copies thereof, are annexed collectively as Annexure-II (Colly).

The Petition notes that despite receipt of goods without any demur and acceptance of the invoices raised by the Operational Creditor, the Corporate Debtor failed and neglected to make payment of the outstanding amounts within the stipulated time. The Operational Creditor maintained a running ledger account in the ordinary course

of business, reflecting all transactions, invoices raised and payments received, if any. As per the said ledger account, a sum of ₹19,02,97,336.41/- remains due and payable by the Corporate Debtor. The copy of the ledger account is annexed herewith and marked as Annexure-III.

The Petition further notes that the Corporate Debtor has committed default in payment of the aforesaid operational debt and the date of default is 11.02.2023, being the date on which the amount became due and remained unpaid. Despite repeated follow-ups and requests made by the Operational Creditor, the Corporate Debtor failed to discharge its liability.

The Petition states that the Operational Creditor, in compliance with the provisions of Section 8 of the Insolvency and Bankruptcy Code, 2016, issued a Demand Notice dated 04.02.2025 in Form 3 calling upon the Corporate Debtor to pay the outstanding operational debt. The Corporate Debtor replied to the said Demand Notice vide reply dated 21.02.2025, raising untenable and baseless contentions, which were duly refuted by the Operational Creditor by way of a rejoinder dated 19.05.2025. The copies of the Demand

Notice, reply and rejoinder along with their annexures are annexed herewith and marked as Annexure-IV (Colly).

On perusal of Part-V of Form-5, it is revealed that the Petitioner/Operational Creditor has categorically stated that it does not hold any security interest in respect of the operational debt claimed in the present application. It is further stated that there is no retention of title or reservation of ownership clause in respect of the goods supplied to the Corporate Debtor forming the subject matter of the present petition.

It is further revealed that there is no order or decree passed by any Court of law, Tribunal or Arbitral Authority adjudicating upon the operational debt or default in question. The Petitioner has also clarified that the provisions relating to succession certificate, probate of will or letters of administration are not applicable to the present case.

It is stated that the Petitioner has relied upon the record of default, if any, maintained with the Information Utility, and has annexed relevant documents evidencing the occurrence of default. In the present case, the Operational Creditor has primarily relied upon documentary evidence such as purchase orders, invoices, and ledger account to substantiate the claim of default.

It is further revealed that the Petitioner has placed on record the ledger account of the Corporate Debtor maintained in the ordinary course of business, reflecting the transactions between the parties and the outstanding operational debt, which has been annexed as Annexure-III. The Petitioner has also annexed copies of invoices (Annexure-II Colly) and purchase orders (Annexure-I Colly) in support of the claim.

It is further revealed that the Petitioner has annexed the Demand Notice dated 04.02.2025 issued under Section 8 of the Insolvency and Bankruptcy Code, 2016, along with the reply dated 21.02.2025 and rejoinder dated 13.05.2025, together with proof of service, which are collectively annexed as Annexure-IV (Colly).

The Petitioner has further stated that apart from the aforesaid documents, all other relevant documents evidencing the existence of operational debt and default, including correspondence exchanged between the parties, have also been annexed to the present application. The said documents clearly establish the liability of the Corporate Debtor and the occurrence of default within the meaning of the Insolvency and Bankruptcy Code, 2016.

The Petitioner has placed the facts through this Petition in the following manner: -

It is stated that the Petitioner, Intertex Private Limited, is engaged in the business of trading and supply of goods, including iron ore pellets and lam coke. The Respondent, Electrotherm (India) Limited, is a company incorporated under the provisions of the Companies Act and is engaged in manufacturing and allied industrial activities. In the ordinary course of business, the Respondent approached the Petitioner and placed purchase orders for supply of the aforesaid goods from time to time.

Pursuant to the said business relationship, the Respondent issued various purchase orders upon the Petitioner, inter alia, specifying the description of goods, quantity, price, delivery terms and other commercial conditions. The Petitioner duly supplied the goods in accordance with the said purchase orders without any demur or dispute from the Respondent.

It is stated that against the aforesaid supplies, the Petitioner raised several invoices upon the Respondent during the period from 19.10.2022 to 11.01.2023, clearly reflecting the invoice number, date, due date and amount payable. As per the agreed terms between the parties, payment of the invoices was required to be made within 30 days from the date of invoice.

It is further stated that despite receipt and acceptance of the goods and invoices, the Respondent failed to make payment of the outstanding dues within the stipulated period. The due dates of the invoices fell between November 2022 and February 2023 (including 11.01.2023), and upon failure of the Respondent to clear the dues, the Petitioner repeatedly followed up with the Respondent requesting payment of the outstanding amounts.

It is stated that despite repeated requests and follow-ups, the Respondent failed and neglected to discharge its liability towards the Petitioner, resulting in accumulation of outstanding dues. The Petitioner maintained a running ledger account in the ordinary course of business, reflecting the transactions between the parties and the outstanding amount payable by the Respondent.

It is stated that since the Respondent failed to clear the outstanding dues, the Petitioner issued a Demand Notice dated 04.02.2025 under Section 8 of the Insolvency and Bankruptcy Code, 2016, calling upon the Respondent to pay the outstanding operational debt. The said demand notice was duly served upon the Respondent.

Thereafter, the Respondent replied to the said Demand Notice vide reply dated 21.02.2025, raising untenable and baseless contentions, which were duly refuted by the Petitioner by way of a rejoinder dated 19.05.2025. The Respondent, however, failed to make payment of the outstanding dues.

It is further stated that as per the books of account and ledger maintained by the Petitioner, a sum of Rs. 19,02,97,336.41/- remains due and payable by the Respondent, and the Respondent has committed default in payment of the said operational debt, the date of default being 11.02.2023.

It is therefore submitted that despite service of the demand notice and sufficient opportunity, the Respondent has failed to discharge the outstanding operational debt, thereby committing default within the meaning of Section 3(12) of the Insolvency and Bankruptcy Code, 2016, and consequently, the Petitioner has filed the present application under Section 9 of the Code seeking initiation of Corporate Insolvency Resolution Process against the Respondent.

The Petitioner has filed an Undertaking through its authorised signatory confirming that the claim has been duly submitted with the Information Utility, namely National E-Governance Services Limited (NeSL) and that Form-C has already been filed as part of the present Petition. The Petitioner has further undertaken to file Form-D upon receipt from the Information Utility before this Hon'ble Tribunal.

The Petitioner/Operational Creditor has filed an Additional Affidavit on 28.07.2025 vide Inward Diary No. D- 5063 ( DMS Portal on 26.07.2025) placing on record copies of GSTR-Form 1 and GSTR-Form 3B returns for the relevant period, which are annexed as Annexure-I (Colly). The said statutory returns reflect the outward supply of goods made by the Petitioner to the Corporate Debtor and substantiate the transactions forming part of the operational debt claimed in the present Petition.

This Adjudicating Authority vide Order dated 28.07.2025, directed issuance of notice to the Respondent and further directed the Petitioner to serve the same through Registered Post/Speed Post, Dasti, and Email. In compliance with the said Order, the Petitioner has filed an Affidavit of Service on 18.08.2025 vide Inward Diary No. D-5589 evidencing that the notice along with copy of the Petition and the said Order was duly served upon the Respondent.

It is seen from the Affidavit of Service that the Petitioner initially attempted to serve the notice at the registered address of the Respondent; however, the same was refused by the Respondent. Thereafter, the Petitioner caused service through letter dated 31.07.2025 (Annexure-B) along with tracking details, and further effected service through email dated 01.08.2025 (Annexure-C) upon the registered email address of the Respondent. The postal tracking records (as seen in the annexed documents) indicate that the article was duly processed and delivered.

This Adjudicating Authority, vide Order dated 28.07.2025, directed the Applicant/Operational Creditor to place on record the bank account statements along with bank certificate and the last audited financial statements of the Operational Creditor by way of an additional affidavit.

In compliance with the aforesaid directions of this Adjudicating Authority, the Applicant/Operational Creditor has filed an Additional Affidavit on 21.08.2025, vide Inward Diary No.D- 5608, placing on record various documents in support of the present Petition, which are summarised hereunder:

It is submitted that the Applicant/Operational Creditor has placed on record the bank statements for the period from September 2022 to July 2025 along with the bank certificate, which are collectively annexed as Annexure-I (Colly). The said bank statements, commencing from September 2022, clearly demonstrate the financial transactions undertaken in the ordinary course of business and corroborate the commercial dealings between the parties.

It is further seen that the Petitioner has also annexed the last audited financial statements of the Operational Creditor as Annexure-II, thereby establishing the financial standing and regular course of business of the Petitioner. Additionally, the Petitioner has placed on record copies of invoices along with corresponding e-way bills, collectively annexed as Annexure-III (Colly) (running into multiple volumes), evidencing the actual supply and movement of goods to the Corporate Debtor.

It is submitted that the aforesaid documents, including bank statements, audited financials, and invoices with e-way bills, clearly establish the genuineness of transactions, supply of goods and existence of operational debt, and the same have been taken on record by this Tribunal.

The Corporate Debtor filed its Reply on DMOS Portal on 05.09.2025. This Adjudicating Authority, vide Order dated 12.09.2025, took on record the reply filed by the Respondent, despite a delay of a few days in filing the same, which delay was condoned. The contentions of the respondent are mentioned hereunder: -

It is submitted that the Respondent/Corporate Debtor, through its authorised signatory, has filed an Affidavit-in-Reply (11 pages) opposing the present Petition and the reliefs sought therein, and has raised various objections against the admission of the Petition.

The Respondent/Corporate Debtor has contended that the present Petition is not supported by any authority letter or board resolution, and on this ground alone, the Petition is liable to be rejected.

The present Petition suffers from various defects, as detailed in the Affidavit-in-Reply, and has sought rejection of the Petition on such grounds:

The Respondent/Corporate Debtor has contended that there exist pre-existing disputes between the parties, which were duly communicated prior to issuance of the Demand Notice under the Insolvency and Bankruptcy Code, 2016.

The Respondent/Corporate Debtor has contended that the goods supplied by the Petitioner, namely iron ore pellets, lam coke and lam coke fines, were of inferior/defective quality and/or short supplied, and accordingly, the Respondent issued debit notes in respect thereof. It is further stated that such debit notes were communicated to the Petitioner through courier on 03.12.2022, 25.07.2023 and 06.12.2023, and via email dated 11.12.2023, i.e., prior to issuance of the Demand Notice. A copy of the email dated 11.12.2023 is annexed as Annexure-R1.

The Respondent/Corporate Debtor has further contended that the Petitioner, vide email dated 15.12.2023, refused to accept the debit notes and stated that the same were returned on 08.12.2022, 29.07.2023 and 08.12.2023. It is alleged that the said correspondence evidences the existence of pre-existing disputes between the parties with respect to quality and short supply of goods prior to issuance of the Demand Notice. A copy of the email dated 15.12.2023 is annexed as Annexure-R2.

The Respondent/Corporate Debtor has further contended that, vide email dated 15.12.2023, it informed the Petitioner that the debit notes were issued based on QC reports, and that the performance of its furnaces was adversely affected during the period of supply. The Respondent also requested the Petitioner to provide a revised ledger account for reconciliation purposes. A copy of the said email dated 15.12.2023 is annexed as Annexure-R3.

The Respondent/Corporate Debtor has contended that the debit notes issued by it were based on supporting documents and laboratory reports, which allegedly establish that the goods supplied were of inferior quality. Copies of the debit notes along with relevant documents and the lab report are annexed as Annexure-R4.

It is further contended that the Petitioner has also initiated proceedings under Section 138 of the Negotiable Instruments Act, 1881 against the Respondent, which are stated to be pending adjudication. It is further contended, by placing reliance on Section 5(6) of the Insolvency and Bankruptcy Code, 2016, that the existence of such proceedings constitutes a “dispute” within the meaning of the Code.

The Respondent/Corporate Debtor has contended that the proceedings initiated under Section 138 of the Negotiable Instruments Act, 1881, pending before the Learned JMFC, Mumbai, constitute a pre-existing dispute between the parties. In support thereof, the Respondent has annexed copies of the notice dated 09.01.2023, reply dated 24.01.2023 and the status report of Criminal Case bearing Summary Case No. 3300575/2023, collectively annexed as Annexure-R5.

The Respondent/Corporate Debtor has contended that, in view of the alleged pre-existing disputes, even the record of default filed with the Information Utility in Form-C reflects a disputed status. In support thereof, the Respondent has annexed a copy of the Record of Financial Information (Form-C) issued by National E-Governance Services Limited (NeSL) as Annexure-R6.

The Respondent/Corporate Debtor has contended that there exists a history of disputes between the parties, including transactions in the year 2020, wherein it is alleged that the Petitioner had supplied inferior quality/short quantity of goods and failed to adjust debit notes. It is further stated that the Petitioner had initiated proceedings under Section 138 of the Negotiable Instruments Act, 1881, which were subsequently withdrawn upon reconciliation and amicable settlement before Lok Adalat. In support thereof, the Respondent has annexed copies of the notice dated 30.11.2020, status report of SS Case No. 4300499/2021 and Order of disposal dated 13.08.2022, collectively as Annexure-R7.

C. Corporate Debtor is Commercially Solvent, Going Concern 6b Operational and viable entity

It is submitted that the Respondent/Corporate Debtor is a company incorporated under the provisions of the Companies Act, 1956 and is engaged in the business of manufacturing and sale of induction furnaces, engineering equipment, steel, ductile iron pipes, electric vehicles, transformers, and allied products. The Respondent has also disclosed its authorised, issued, and paid-up share capital is as under: -

It is submitted that the Respondent/Corporate Debtor was incorporated on 29.10.1986 as Foremost Chemical Limited and was subsequently renamed as Electrotherm (India) Limited in the year 1994. It is further stated that the Company was initially listed with regional stock exchanges and thereafter listed on the Bombay Stock Exchange (BSE) in October 1994 and on the National Stock Exchange of India Limited (NSE) in August 2007, and presently has approximately 9,000 shareholders.

It is submitted that the Respondent/Corporate Debtor is a multi-divisional, multi-product and multi-location company, having its manufacturing facilities at Palodia, Taluka Kalol, District Gandhinagar (Engineering & Technologies Division) and Samakhiyali, Taluka Bhachau, District Kutch (Special Steel & Electric Vehicle Division). It is further stated that the Respondent also has certain inoperative divisions/assets situated at Juni Jithardi (Vadodara), Vatva Industrial Estate (Ahmedabad) and Dhank (Rajkot).

It is submitted that the Respondent/Corporate Debtor operates through three principal business verticals, namely: (i) Engineering & Technologies Division catering to the metal melting industry, (ii) Steel Division, being a fully integrated steel plant manufacturing TMT bars and DI pipes, and (iii) Electric Vehicle Division engaged in manufacturing battery-operated two-wheelers. It is further stated that the Respondent is a leading manufacturer of induction melting furnaces and refining equipment, with global presence through installations across multiple countries, and is also engaged in execution of turnkey projects. The Respondent has further claimed a strong market presence in steel and DI pipe products, supported by an established distribution network and approvals from various government and private entities.

It is submitted that the Respondent/Corporate Debtor has contended that its Engineering & Technologies Division supplies metal melting furnaces to steel producers globally and smaller furnaces to the domestic foundry industry, and maintains a substantial order book of approximately Rs.700-Rs.800 Crores, contributing significantly to its revenues. It is further stated that the Respondent's TMT division (ET TMT) caters to various infrastructure and construction companies, while its ductile iron pipe business supplies to government departments and infrastructure entities in India and has also undertaken exports to international markets. The Respondent has further stated that it has substantial receivables from government and other customers arising from such supplies.

It is submitted that the Respondent/Corporate Debtor is a going concern and a running industrial unit, and has placed on record its financial performance for the last five financial years, reflecting its operational and financial position. The financial snapshot of the Respondent for the said period is set out hereinbelow:

(Rs. in Crores)

*Profit after Tax before Exceptional Item The relevant pages of Statement of Profit & Loss of the Annual Report of respective years at Annexure-R8.

It is submitted that the Respondent/Corporate Debtor has contended that it provides direct and indirect employment to more than 5,000 employees/workmen, thereby reflecting its status as a significant running industrial concern.

It is submitted that the Respondent/Corporate Debtor has contended that more than 5,000 families are dependent on its operations, and that its financial viability is evident from the fact that it has paid salaries and wages amounting to Rs.311.39 Crores in F.Y. 2024-2025, thereby demonstrating its status as a going concern.

It is submitted that the Respondent/Corporate Debtor has contended that it is a commercially solvent and going concern, and that the present Petition has been filed as a recovery mechanism for disputed dues, which is impermissible under the scheme and object of the Insolvency and Bankruptcy Code, 2016. It is further alleged that the claim is subject to pending reconciliation of accounts, and therefore, the present Petition is liable to be dismissed with exemplary costs.

In compliance with the order dated 12.09.2025, the Applicant/Operational Creditor has filed its rejoinder on 29.09.2025 vide Inward Diary No. D- 6621 (on DMS Portal on 26.09.2025). The contents of the said rejoinder are reproduced herein below:

This Hon'ble Tribunal, vide Order dated 14.10.2025, after hearing the Learned Senior Counsel for the parties, recorded that the Learned Senior Counsel for the Applicant/Operational Creditor agreed to undertake reconciliation of the debit notes referred to by the Corporate Debtor with its books of account to verify whether those amounts are accounted or not.

It was further directed that the Applicant shall file an Additional Affidavit in this regard. In compliance thereof, the Applicant has filed the said Additional Affidavit, albeit belatedly, on 07.11.2025, vide Inward Diary No. D-7362, and the same has been taken on record by this Hon'ble Tribunal. The contents thereof are summarised/reproduced hereunder:

It is submitted that, in compliance with the order dated 14.10.2025 passed by this Hon'ble Tribunal, the Applicant/Operational Creditor has filed an Affidavit in Compliance placing on record reconciliation of debit notes raised by the Corporate Debtor with the books of accounts of the Applicant.

It is further submitted that the Corporate Debtor had raised various debit notes against invoices; however, upon reconciliation, the Applicant has duly accounted for such debit notes in its books, to the extent accepted, and the same stands reflected in the accounts.

The debit notes pertain to period form 31.07.2022. The invoices raised by the Applicant for the period from 19.10.2022 onwards remain outstanding and unpaid, thereby constituting operational debt due and payable.

The debit notes issued by the Corporate Debtor which were genuine and accepted by the OC were already accounted for in the books of account of the OC.

It is submitted that the Applicant has issued corresponding credit notes, wherever applicable, in respect of accepted debit notes, and the same are collectively annexed as Annexure-A (Colly).

It is further submitted that the ledger account of the Corporate Debtor for the period 01.04.2022 to 31.03.2023, reflecting all transactions including adjustments, payments and outstanding balances, is annexed as Annexure-B, which clearly establishes the subsisting default.

It is submitted that even after giving effect to all debit/credit adjustments, an amount of Rs.19,02,97,336.41/- remains due and payable as on the date of filing of the Petition for the invoices for period 19.10.2022 to 11.01.2023, thereby evidencing default under the provisions of the Insolvency and Bankruptcy Code, 2016.

It is further submitted that the debit notes issued by the Corporate Debtor have neither been duly substantiated nor accepted in entirety and are therefore unsustainable and liable to be disregarded by this Hon'ble Tribunal.

Further, the Respondent/Corporate Debtor has filed an Affidavit dated 10.11.2025 vide Inward Diary No. D-7455, (On 18.11.2025 on DMS Portal) placing on record certain additional submissions in support of its defence, which are summarised hereunder:

It is submitted that the Respondent – Corporate Debtor has filed an Affidavit placing on record that the deponent is the authorised signatory/Executive Vice Chairman and is duly competent and authorised to depose in the present matter.

It is further submitted that during the pendency of the present Petition, the Corporate Debtor has made a payment of Rs.29,32,869/- on 07.11.2025 through RTGS (UTR Ref. No. RTGS Dr-IDIB000F523-INTERTEX PRIVATE LTD-AHMEDABAD-YESBR520251107565558401), which has been acknowledged in the said affidavit.

It is submitted that the Corporate Debtor has contended that it had issued debit notes amounting to Rs.18,79,07,985.55 prior to issuance of the Demand Notice, which according to it constitutes adjustment against the alleged dues.

It is further submitted that the Corporate Debtor has alleged that upon reconciliation of ledger accounts and adjustment of debit notes along with the aforesaid payment dated 07.11.2025, the entire outstanding amount stands paid and no amount remains due and payable.

It is submitted that based on the above contentions, the Corporate Debtor has prayed for dismissal of the present Petition.

In compliance with the Order dated 10.11.2025, the Respondent/Corporate Debtor has filed its Counter Affidavit to the affidavit filed by the Applicant on 10.12.2025, vide Inward Diary No. 8344, placing on record its submissions, which is summarised as below: -

The Respondent/Corporate Debtor has filed an Additional Affidavit in response to the Affidavit dated 05.11.2025 filed by the Petitioner, through its authorised signatory, who is duly competent and conversant with the facts of the case.

The Corporate Debtor has reiterated that, during the pendency of the Petition, it has made a payment of Rs.29,32,869/- on 07.11.2025 through RTGS, which has been duly placed on record.

The Corporate Debtor has contended that 370 debit notes amounting to Rs.18,79,07,985.55 were issued and served upon the Petitioner prior to issuance of the Demand Notice, and therefore, the same constitute a pre-existing dispute under the Code.

The Corporate Debtor has contended that the issue regarding acceptance or non-acceptance of debit notes is irrelevant for the purpose of Section 9 proceedings, and that such disputes pertaining to quality of goods are required to be adjudicated by a competent court and not under summary jurisdiction of this Hon'ble Tribunal.

The Corporate Debtor has relied upon the terms and conditions of purchase orders, contending that the Petitioner was obligated to maintain quality of goods and therefore cannot dispute the debit notes raised on account of quality issues.

The Corporate Debtor has contended that the transactions between the parties were running and continuous in nature, and therefore, debit notes are required to be adjusted against the entire account and not against specific invoices.

The Corporate Debtor has contended that regarding alleged default of Rs 19,02,97,336.41 after adjusting debit notes and payments, no amount remains due and payable, and therefore, the present Petition is liable to be dismissed.

The Respondent/Corporate Debtor has placed reliance on the judgment of this Hon'ble Tribunal in Shah Paper Mills Limited vs. Shree Rama News Print and Paper Limited, to contend that a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 cannot be maintained as a recovery proceeding.

The Corporate Debtor has relied upon a judgment to contend that a defective demand notice may render the Petition non-maintainable, contrary to the submissions of the Petitioner.

The Respondent/Corporate Debtor has relied upon the judgment in N H Scrap Traders through its Proprietor Nareshkumar Harishchandra Shakya vs. Kena Alloys Private Limited, to contend that a defective demand notice renders the petition non-maintainable.

The Corporate Debtor has contended that its in-house Chemical & Physical Testing Laboratory is accredited by NABL, and in support thereof, has annexed a copy of the NABL Certificate as Annexure-S1.

The Corporate Debtor has also placed on record a Chartered Accountant Certificate (Annexure-S2) to contend that it has not wrongly availed Input Tax Credit (ITC), and that ITC has been reversed in accordance with the provisions of the GST law.

Based on the aforesaid contentions, the Corporate Debtor has prayed for dismissal of the present Petition with exemplary costs.

Further, in compliance with the Order dated 10.11.2025, the Applicant/Operational Creditor has filed its Rejoinder to the Counter Affidavit of the Respondent on 16.12.2025 vide Inward Diary No. D-8606, placing on record its submissions, which are reproduced/summarised hereunder:

The present Rejoinder has been filed by the Applicant/Operational Creditor in response to the Additional Affidavit dated 09.12.2025 filed by the Corporate Debtor, placing on record its submissions in compliance with the directions of this Hon'ble Tribunal.

The payment of Rs.29,32,869/- made on 07.11.2025 by the Corporate Debtor does not affect the maintainability of the present Petition, as the default is to be determined as on the date of filing of the Petition, and such payment only evidences acknowledgment of liability.

The said payment demonstrates a continuing admission of liability by the Corporate Debtor and negates the allegation of any pre-existing dispute.

Alleged 370 debit notes amounting to Rs.18,79,07,985.55 do not constitute a valid pre-existing dispute and have been specifically denied by the Petitioner, and the Petitioner has already given credit of Rs.5,68,697.09 as reflected in the ledger.

The Corporate Debtor, in its reply dated 24.01.2023 to the notice under Section 138 of the Negotiable Instruments Act, did not raise any dispute regarding quality, weight or debit notes, and only cited internal issues, thereby establishing that the alleged dispute is an afterthought.

The debit notes were first communicated much later vide email dated 11.12.2023, after a substantial delay, which further establishes that the defence of pre-existing dispute is a moonshine defence.

The purchase orders relied upon by the Corporate Debtor do not contain quality specifications and the goods were supplied on “as is where is” basis, and were duly consumed without objection, thereby negating any allegation of defective supply.

It is submitted that no contemporaneous complaint, rejection memo, test report, or evidence of deficiency was ever raised by the Corporate Debtor, and therefore, the allegation of quality issues is unsustainable.

The debit notes cannot be unilaterally adjusted in a running account unless accepted by the supplier, and the Petitioner has neither accepted nor acted upon such debit notes, and the same do not relate to the invoices forming the subject matter of the present Petition.

The date of filing of the Petition, the operational debt amounted to ₹19,02,97,336.41 (principal) and remained unpaid, and subsequent payments are irrelevant for determining default under the Code.

The Corporate Debtor cannot reduce its liability unilaterally by issuing debit notes and thereafter claim that the Petition has become infructuous.

The test reports relied upon by the Corporate Debtor do not disclose sampling details, chain of custody, or correlation with specific invoices, and no such reports were ever shared contemporaneously with the Petitioner, and therefore cannot be relied upon.

It is further submitted that reliance on NABL accreditation is misplaced, as a general accreditation does not establish existence of a dispute, particularly when raised after filing of the Petition.

It is submitted that the reliance placed on a Chartered Accountant Certificate for GST adjustments is unilateral, incapable of independent verification, and does not establish acceptance of debit notes or existence of a dispute.

The Respondent/Corporate Debtor has filed its written submissions on 19.12.2025 vide Inward Diary No. D- 8678 (On 17.12.2025 on DMS Portal). In the said written submissions, the Respondent has, inter alia, relied upon the following judgments, the relevant extracts whereof are reproduced hereinbelow:

Mohit Minerals Limited v. Shree Rama News Print Limited. Hon'ble NCLAT in Company Appeal (AT) (Ins) No.620 of 2019

Tirupati Enterprise v. Sadbhav Engineering Ltd Hon'ble NCLAT in Company Appeal (AT) (Ins) No. 95 of 2025

Tirupati Enterprise v. Sadbhav Engineering Ltd. [Copy of order dated 14.11,2025 passed by the Hon'ble Supreme Court in Civil Appeal No. 31747 of 2025]

Further, the Applicant/Operational Creditor has also filed its written submissions on 05.03.2026 vide Inward Diary No. D- 2014. In the said written submissions, the Operational Creditor has relied upon the following judgments, the relevant extracts whereof are reproduced herein below:

Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd.

Mr. Mukesh Goel v. Aldous Commodities Private Limited and Anr.

Anup Sushil Dubey Suspended Board Member Umarai Worldwide (P) Ltd. v. National Agriculture Co-operative Marketing Federation of India Ltd. and Anr.

M/s Saraswati Wire and Cable Industries v. Mohammad Moinuddin Khan

R.J. Packwells Pvt. Ltd. v. Maurya Printers Pvt. Ltd.

Kewan Krishan Sharma v. Navneet Gupta (RP) and Anr.

Furthermore, in compliance with the order dated 18.12.2025, an additional affidavit has been filed by the Applicant/Operational Creditor on 05.03.2026 vide Inward Diary No. D-1990 (On 03.12.2025 on DMS Portal) to place on record the Form-D generated by Information Utility being record of default with the status of the debt and default is recorded as “Disputed”. The same is taken on record.

This Tribunal vide order dated 06.03.2026, recorded that during hearing, the learned Senior Counsel appearing for the Respondent/Corporate Debtor contended that in the present case also the amount of debt and default shown no more exists in view of the debit notes raised by the Corporate Debtor and balance amount has already been paid which is in excess of the balance amount.

It is submitted that the Corporate Debtor has placed reliance on a tabular statement reflecting the alleged adjustment of debit notes and payments, contending that the outstanding amount stands fully discharged.

It is further submitted that the learned Senior Counsel for the Applicant/Operational Creditor has disputed the unilateral adjustment of debit notes, and has contended that the amount claimed in the Petition continues to remain due and payable, thereby constituting default under the Code.

We have heard the arguments of the Ld. Sr. Counsel for the Petitioner/Operational Creditor as well as Ld. Sr. Counsel for the Respondent/Corporate Debtor and have perused the material available on record. We frame the following issues for our determination:

A. Whether there exist an operational debt and default within the meaning of Section 5(21) and Section 3(12) of the Insolvency and Bankruptcy Code, 2016?

B. Whether a pre-existing dispute, including in respect of debit notes and the quantum of liability, existed between the parties prior to the issuance of the Demand Notice dated 04.02.2025, thereby rendering the present petition under Section 9 of the Code not maintainable?

C. Whether, in view of the payments made and adjustments claimed, any amount remains due and payable by the Corporate Debtor to the Petitioner?

D. Whether the present petition filed under Section 9 of the Code is maintainable in the facts and circumstances of the case?

We state below brief facts of the case:

The present Company Petition has been filed by the Petitioner/Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code, 2016 seeking initiation of Corporate Insolvency Resolution Process against the Respondent/Corporate Debtor for an alleged default of ₹19,02,97,336.41/-.

It is the case of the Petitioner that pursuant to Purchase Orders dated 13.10.2022 (Annexure-I to the Petition), the Petitioner supplied goods, namely Iron Ore Pellets and LAM Coke Fines, to the Corporate Debtor during the period October 2022 to February 2023, against which invoices were raised from time to time (Annexure-II). As per the terms of the transaction, payment was to be made within 30 days from the date of invoice. It is further submitted that despite repeated reminders, the Corporate Debtor failed to make payment of the outstanding dues.

The Petitioner thereafter issued a Demand Notice dated 04.02.2025 under Section 8 of the Code (Annexure-IV), to which the Corporate Debtor replied on 21.02.2025, raising disputes about the quality of goods supplied and enclosing details of debit notes. The Petitioner filed a rejoinder dated 13.05.2025, denying the said contentions.

The Corporate Debtor, in its Reply, has contended that there exists a pre-existing dispute on account of defective quality of goods, short supply and discrepancies, and has relied upon 370 debit notes aggregating to ₹18,79,07,985.55/- (Annexures R4 to Reply), which were issued prior to the issue of demand notice. It is further contended that after adjustment of such debit notes and payments made, no amount remains due and payable.

Additional affidavits have been filed by both parties, including the record of default (Form-D) obtained from the Information Utility, wherein the status of the debt is recorded as “disputed.”

We also summarise the chronology of events leading to the filing of the Present Petition by the Operational Creditor:

Based on the facts of the case, we now consider the issues framed.

Findings on Issue No. A: Whether there exist an operational debt and default within the meaning of Section 5(21) and Section 3(12) of the Insolvency and Bankruptcy Code, 2016?

Upon consideration of the pleadings and documents placed on record, this Adjudicating Authority observes that the existence of commercial transactions between the parties is not in dispute. The record reveals that the Corporate Debtor had placed Purchase Orders on various dates from 13.10.2022 to 5.11.2022) (Annexure-I to the Petition) upon the Petitioner for supply of Iron Ore Pellets and LAM Coke Fines. Pursuant thereto, the Petitioner effected supplies from time to time and raised corresponding invoices during the period October 2022 to 11.02.2023 (Annexure-II to the Petition). The terms of payment, as reflected from the invoices, stipulated that the amounts were payable within 30 days from the date of invoice.

The Petitioner has relied upon the said invoices, ledger account (Annexure-III) and the Demand Notice dated 04.02.2025 issued under Section 8 of the Code (Annexure-IV), to contend that an amount of ₹19,02,97,336.41/- remained unpaid and in default. The Corporate Debtor has not denied receipt of goods nor has it disputed the underlying business relationship between the parties. There is no dispute on the issue of invoices and supply of material except that raised in the debit notes discussed later in this order.

However, it is equally evident from the record that the Corporate Debtor has not admitted the liability in the amount claimed by the Petitioner. In its Reply to the Demand Notice dated 21.02.2025 (Annexure-IV, Colly.), the Corporate Debtor has specifically disputed the quantum of liability and has contended that substantial deductions are liable to be made on account of debit notes raised towards defective quality of goods, short supply, and other discrepancies. For the sake of convenience, the reply dated 21.02.2025 is

reproduced hereinbelow:

The Corporate Debtor has further placed reliance upon 370 debit notes aggregating to ₹18,79,07,985.55/- (Annexures R4 to Reply), which, according to it, substantially reduce or extinguish the liability claimed by the Petitioner.

It is also pertinent to note that the date of default has been stated as 11.02.2023, being the date on which the last invoice fell due, and the said position is also reflected in the record of default obtained from the Information Utility (Form-D placed on record by way of additional affidavit). However, the said record itself indicates that the debt is marked as “disputed,” thereby reflecting the existence of a contest regarding liability.

In these circumstances, although the supply of goods and raising of invoices stand established from the material on record, the existence of an operational debt in the amount claimed and the occurrence of default cannot be stated to be with certainty. The determination of the actual amount due, if any, is intrinsically dependent upon the validity, enforceability, and adjustment of the 370 debit notes aggregating to ₹18,79,07,985.55/-, which have been raised by the Corporate Debtor on 03.12.2022, 13.01.2023 and 25.07.2023 and communicated via email on 11.12.2023 prior to the issuance of the Demand Notice dated 04.02.2025, and the same forms the subject matter of dispute between the parties.

Accordingly, this Tribunal holds that although the supply of goods and raising of invoices stand established. However, in view of the existence of a pre-existing dispute, this Adjudicating Authority refrains from conclusively determining the existence of default in terms of Section 3(12) of the Code.

Findings on Issue No. B: Whether a pre-existing dispute, including in respect of debit notes and the quantum of liability, existed between the parties prior to the issuance of the Demand Notice dated 04.02.2025, thereby rendering the present petition under Section 9 of the Code not maintainable?

To decide this issue, we refer to the contents of relevant documents:

The principal issue that arises for consideration is whether a dispute with respect to the goods supplied and the consequent liability had been raised by the Corporate Debtor prior to the issuance of the Demand Notice dated 04.02.2025, to render the present petition under Section 9 of the Code not maintainable.

The Corporate Debtor has, in its Reply to the Demand Notice dated 21.02.2025 (Annexure-IV, Colly. to the Petition), as well as in its detailed Reply to the present petition, categorically disputed the liability claimed by the Petitioner and has placed reliance upon 370 debit notes aggregating to ₹18,79,07,985.55/-. It is the specific case of the Corporate Debtor that such debit notes were raised on account of defective and inferior quality of goods, short supply, and other discrepancies, which adversely affected its furnace operations and commercial performance.

It is observed that the said debit notes were not raised for the first time in response to the Demand Notice, but were issued in the ordinary course of business transactions between the parties. The debit notes have been shown to have been issued on various dates commencing from 03.12.2022, including 13.01.2023 and 25.07.2023, and were subsequently consolidated and communicated to the Petitioner through email dated 11.12.2023. These dates clearly fall within and immediately subsequent to the period of supply of goods, i.e., October 2022 to 11.02.2023, and are significantly prior to the issuance of the Demand Notice dated 04.02.2025 under Section 8 of the Code. For the sake of convenience email dated 11.12.2023 is reproduced hereinbelow: -

The Corporate Debtor has further placed reliance upon contemporaneous correspondence exchanged between the parties, including email dated 11.12.2023, as well as certain technical/laboratory reports, to support its contention regarding deficiencies in the goods supplied. Although the Petitioner has contested the correctness and evidentiary value of such material, the same prima facie reflects that objections relating to the quality and performance of the goods were raised by the Corporate Debtor prior to the issuance of the Demand Notice.

Per contra, the Petitioner has contended that the debit notes are unilateral in nature, were not accepted by it and therefore cannot be relied upon to reduce or extinguish the liability. It has further been contended that the dispute is an afterthought and that no contemporaneous objection was raised at the time of supply, and has also relied upon the terms of invoices stating that the goods were supplied on an “as is where is basis.”

The contention of the Petitioner that no dispute was raised in earlier proceedings under the Negotiable Instruments Act does not, in the considered view of this Tribunal, negate the existence of dispute, because the material placed on record, including debit notes and contemporaneous correspondence, demonstrates that disputes relating to quality and adjustments had arisen during transactions and prior to the issuance of the demand notice under section 8 of the Code. The existence of dispute is to be assessed based on overall material and not on isolated pleadings in separate proceedings.

Upon a careful consideration of the debit notes and period of issue, this Adjudicating Authority finds that the debit notes relied upon by the Corporate Debtor cannot be said to be a mere afterthought or a spurious defence. The issuance of debit notes commencing from 03.12.2022, i.e., during the subsistence of the transactions, followed by further debit notes on 13.01.2023 and 25.07.2023, and their communication through email dated 11.12.2023, clearly establishes that the Corporate Debtor had raised disputes in respect of the goods supplied well prior to the issuance of the Demand Notice dated 04.02.2025. The contention of the Petitioner that the dispute has been raised only as a defence to the Demand Notice is therefore not borne out from the record.

In this regard, reliance placed by the Corporate Debtor on the judgment of the Hon’ble NCLAT in M/s Mohit Minerals Limited v. M/s Shree Rama Newsprint Ltd. Company Appeal (AT)(Insolvency) No. 620 of 2019 wherein it has been held that debit notes and disputes raised prior to the issuance of the demand notice constitute a pre-existing dispute and the application under Section 9 is liable to be rejected. In para 10 of the judgement following has been laid down: -

[Emphasis supplied]

Similarly, in Tirupati Drilling & Mining Services Private Limited v. Sadbhav Engineering Limited Company Appeal (AT) (Insolvency) No. 95 of 2025 & I.A. No. 395 of 2025, the Hon’ble Appellate Tribunal has held that disputes relating to the quantum of amount and contractual claims, when raised prior to the demand notice, constitute a valid pre-existing dispute disentitling admission of a petition under Section 9 of the Code.

[Emphasis supplied]

A similar view has been taken by the Hon'ble National Company Law Appellate Tribunal in Shri Durga Scaffolding Noida Pvt. Ltd. v. Kanwar Enterprises Pvt. Ltd., (2026) ibclaw.in 52 NCLAT, wherein it has been held that disputes relating to quality of goods, reconciliation of accounts and determination of the quantum of liability, when raised prior to the issuance of the demand notice, constitute valid pre-existing disputes within the meaning of Section 8(2) of the Code. The Hon'ble Appellate Tribunal has further observed that the Adjudicating Authority is not required to examine the merits of such disputes and that once a plausible dispute, supported by material on record, is shown to exist, the application under Section 9 is liable to be rejected.

It is also pertinent to note that the dispute raised by the Corporate Debtor is not a mere bald or unsupported assertion. The Corporate Debtor has placed on record voluminous documentary material, including debit notes and supporting correspondence, which prima facie indicate that the dispute relates to the quality, quantity and commercial acceptability of the goods supplied and the consequent financial adjustments claimed by it. Such disputes inherently involve questions of fact and technical evaluation, which would require detailed evidence and cannot be adjudicated in summary proceedings under Section 9 of the Code.

The Petitioner has relied upon judgments including Mr. Mukesh Goel v. Aldous Commodities Private Limited and Anr. Company Appeal (AT) (Insolvency) No.1235 of 2023 and Anup Sushil Dubey Suspended Board Member Umarai Worldwide (P) Ltd. v. National Agriculture Co-operative Marketing Federation of India Ltd. and Anr. Company Appeal (AT) (Insolvency) No. 229 of 2020 to contend that a mere assertion or unsupported defence cannot be treated as a dispute. However, the said judgments are distinguishable on facts, as in the present case the dispute raised by the Corporate Debtor is supported by contemporaneous material, including debit notes and correspondence prior to the demand notice.

The reliance placed by the Petitioner on M/s. Saraswati Wire and Cable Industries v. Mohammad Moinuddin Khan and others CIVIL APPEAL NO. 12261 OF 2024 to contend that continued payments negate the existence of dispute is also misplaced, as the payments in the present case form part of a running account and do not obliterate disputes arising from debit notes and adjustments.

Further, the Record of Default (Form-D) placed on record by the Petitioner itself, as part of its additional affidavit (Annexure-II thereto), reflects the status of the debt as “disputed,” with remarks indicating that disputes exist about quality, quantity, and short supply of goods. Although such record may not be determinative of the issue, it is nevertheless a relevant circumstance which lends support to the stand of the Corporate Debtor that the liability is disputed.

In this regard, the Hon’ble National Company Law Appellate Tribunal in Bhuvan Kumar Gupta v. Maverick Developers and Colonisers Pvt. Ltd. (2025) ibclaw.in 1058 NCLAT has held that where the record of default in the Information Utility reflects the status of the debt as ‘disputed’, the Adjudicating Authority is obliged to reject the application under Section 9(5)(ii)(d) of the Code. In the present case, the Form-D placed on record also reflects the status of the debt as “disputed”, which further corroborates the existence of a pre-existing dispute between the parties.

At this stage, this Adjudicating Authority is only required to examine whether there exists a plausible contention requiring further investigation and that the dispute is not a patently feeble legal argument, and not to adjudicate upon the merits of the dispute.

Applying the aforesaid test to the facts of the present case, this Adjudicating Authority is satisfied that the defence raised by the Corporate Debtor is supported by contemporaneous documents, including debit notes and correspondence, and raises a real and substantial dispute which is not spurious, hypothetical, or illusory.

Accordingly, this Adjudicating Authority holds that there exists a pre-existing dispute between the parties, which arose prior to the issuance of the Demand Notice dated 04.02.2025, and which cannot be adjudicated in proceedings under Section 9 of the Code.

Findings on Issue No. C: Whether, in view of the payments made and adjustments claimed, any amount remains due and payable by the Corporate Debtor to the Petitioner?

The Petitioner has claimed that a sum of ₹19,02,97,336.41/- is due and payable towards supplies made pursuant to Purchase Orders dated 13.10.2022 (Annexure-I of petition) and invoices raised during the period October 2022 to 11.02.2023 (Annexure-II), with the date of default stated as 11.02.2023, and reiterated in the Demand Notice dated 04.02.2025 (Annexure-IV).

The Corporate Debtor, in its Reply to the Demand Notice dated 21.02.2025 and in its Reply to the present petition, has disputed the said liability and has placed reliance upon 370 debit notes aggregating to ₹18,79,07,985.55/- (Annexures R4 to Reply, running from Pg. 26 to 1909), which, according to it, were issued in the ordinary course of transactions on various dates commencing from 03.12.2022, including 13.01.2023 and 25.07.2023, and were communicated to the Petitioner prior to the Demand Notice, including through email dated 11.12.2023 forming part of the Reply. 44.3. The Corporate Debtor has further placed on record proof of part payment of ₹29,32,869/- made on 07.11.2025 through RTGS, vide UTR Ref No; RTGS Dr-1D1B000F523-1INTERTEX PRIVATE LTD-AHMEDABAD-YESBR52025110756555840 as reflected in its additional affidavit and has contended that after giving effect to the aforesaid debit notes and payments, no amount remains payable. Such payment, made during pendency of proceedings, does not ipso facto establish admission of undisputed liability nor cure the existence of pre-existing dispute.

This Adjudicating Authority observes that the claim of the Corporate Debtor is based on adjustment/set-off of the aforesaid debit notes (Annexures R4 to the Reply, running from Pg. 26 to 1909) against the running account of the Petitioner. It is further noted from the record, including the ledger account of the Petitioner that the Petitioner has accepted certain debit notes to a limited extent by issuance of corresponding credit notes (Annexure A colly of affidavit), while disputing the remaining debit notes. The partial acceptance and partial denial of debit notes by the Petitioner itself demonstrates that the reconciliation of accounts between the parties is not final and remains disputed.

In these circumstances, the determination of the actual amount payable, if any, necessarily requires adjudication of i. the validity and permissibility of the debit notes, ii. the extent to which such debit notes can be adjusted against the invoices, and iii. reconciliation of the running account between the parties, which are matters requiring detailed evidence, examination and cannot be undertaken in summary proceedings under Section 9 of the Code.

The material on record thus demonstrates that the quantum of adjustment of ₹18,79,07,985.55/-, the effect of the payment of ₹29,32,869/-, and the resultant outstanding liability are all seriously disputed between the parties and are not crystallised.

Accordingly, this Tribunal holds that the Petitioner has failed to establish the existence of a crystallised and undisputed operational debt payable by the Corporate Debtor.

Findings on Issue No. D: Whether, in view of the pre-existing dispute between the parties, the present petition is liable to be rejected under Section 9(5)(ii)(d) of the Code?

In view of the findings recorded under Issue No. (B), the present case falls within the ambit of Section 9(5)(ii)(d) of the Code, which mandates rejection of an application where notice of dispute has been received or there exists a record of dispute.

The dispute in the present case pertains to the quality of goods supplied and the consequent liability of the Corporate Debtor after adjustment of debit notes. Such disputes are contractual disputes requiring detailed examination of evidence and cannot be resolved in proceedings under the Insolvency and Bankruptcy Code, which is intended for resolution of insolvency and not for adjudication of disputed claims. The present proceedings, in essence, seek adjudication of disputed contractual claims and cannot be permitted to be used as a substitute for recovery proceedings.

The Hon'ble Supreme Court in Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd. (2017) ibclaw.in01SC has held that,

[Emphasis supplied]

Accordingly, this Adjudicating Authority holds that the present petition does not satisfy the requirements for admission under Section 9 of the Code and is therefore not maintainable. The defence raised by the Corporate Debtor satisfies the test of a 'plausible contention requiring further investigation' and cannot be termed as a patently feeble legal argument.

In view of the foregoing discussion and findings recorded under Issue Nos. (A) to (D), this Adjudicating Authority is satisfied that there exists a pre-existing dispute within the meaning of Section 9(5)(ii)(d) of the Code and that the Petitioner has failed to establish the existence of a clear and undisputed operational debt and default in view of the pre-existing dispute.

It is, however, clarified that this order shall not preclude the Petitioner from pursuing such other remedies as may be available to it in accordance with law.

Accordingly, the present Company Petition CP (IB) No. 287(AHM)2025, is not maintainable and is accordingly dismissed. No order as to costs.