M/s Parnami Security and Manpower Services Private Limited vs Skytone Electricals (India) Ltd.

Per Dr. V.K Subburaj, Member (Technical)

This is a petition filed by M/s. Parnami Security and Manpower Services Private Limited the petitioner/operational creditor seeking to initiate CIRP against the Respondent company /Corporate Debtor M/s Skytone Electricals (India) Ltd., under Section 9 of IBC 2016 for the alleged default on the part of the Corporate Debtor in settling the amount of Rs. 6,63,529/- including the interest component towards the security services supplied. The details of transactions leading to the filing of this petition as averred by the petitioner are as follows:-

a. The Operational creditor is involved in the business of providing men power and security gurads to other companies.

b. That the applicant entered into agreement for suppling security guards on regular basis to the Corporate Debtor and thereafter the operational creditor raised various invoices upon which the payment has been defaulted by the Corporate Debtor.

c. That the applicant has raised various invoices and overtimes sheets bearing nos. 1819036 dated 01.05.2018, 1819068 dated 01.06.2018, 1819123 dated 01.07.2018, 1819131 dated 01.08.2018. 1819131 dated 01.09.2018 and 1819203 dated 01.09.2018 respectively wherein the said invoices were duly accepted and used by the corporate debtor without any dispute in respect of qua the quality and objection regarding the deficiency of the services. Copy of the Attendance Sheets issued by the Corporate Debtor are filed on record.

d. That the corporate debtor had been dealing with operational creditor in pursuance of which it used the services on credit basis against which the invoices were duly raised by the applicant. Further an open, current and running account was maintained in the books of account of the applicant wherein the entries of debit for the services supplied to the corporate debtor and entries of credit for the payment made by the corporate debtor in accounts were regularly made in the ordinary course of the business.

e. Furthermore it is submitted that as per the books of accounts maintained by the applicant, the outstanding amount in default is Rs.6,63,529/- which is still pending. Copy of the Accounts Statement and Certificate under Section 65B of Indian Evidence Act are annexed alongwith.

f. That the operational creditor sent various reminders/e-mails/wrote letters dated 11.06.2018, 14.08.2018 and 17.09.2018 respectively to the corporate debtor requesting for release of the outstanding payment of the unpaid operational debt. However, all the request of the operational creditor fell on the deaf ears of the corporate debtor as it failed to make payment against the invoices raised by the operational creditor, copies of the letters alongwith postal receipts, emails are placed on record.

g. That the operational creditor sent a Demand Notice dated 05.04.2019 demanding payment of an unpaid operational debt as per provisions under Rule 5 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 via Speed Post. Copy of the Demand Notice dated 18.05.2019 demanding payment in prescribed Form 3 under Rule 5 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 duly served upon the address as per the website of Ministry of Corporate Affairs, Government of India, where the operational creditor supplied services to the Corporate Debtor. Further served by email, but chose not to reply to the same.

The Corporate Debtor in its reply to the application submits that:

a. That the corporate debtor submitted that from the bare perusal of the Company's Master Data indicated that the date of incorporation of the operational creditor is 20.02.2009, however, the only alleged agreement dated 28.02.2003 on which the operational creditor relied upon is with some other entity namely M/s Prompt Security Services, however from the comparison of both the dates, it is established that there is no privity of any contract whatsoever with the Operational Creditor and Corporate Debtor.

b. Further, it is submitted that there was no business agreement between the parties and the Operational Creditor failed to place on record any document from which it can be deduced that there was any contract between the parties.

c. Furthermore, it is submitted that there is neither existence of debt nor any default. That the operational creditor has alleged than an amount due and payable for the period between 01.05.2018 to 01.09.2018 against the invoices bearing nos. 1819036,1819068, 1819123,1819131,1819187 and 1819203 wherein the alleged amount had already been paid to M/s Prompt Security Services in accordance with the contract dated 28.02.20003.

In this regard, the petitioner has denied the allegations made in the reply of the corporate debtor and further submitted that:

a. In respect to the name and identity of the Operational Creditor:- It is pertinent to mention that M/s Parnami Security and Manpower Services Pvt. Ltd and M/s Prompt Security Services are one and the same thing and the said fact is well within the knowledge of the Corporate Debtor. Further the name in which the present petition has been initiated is in the name of the petitioner company, apart from that, invoices and letter heads itself mentions both names as well as the complete address of the operational creditor, so as to shed out any doubt as to identity of the operational creditor. Copy of Memorandum and Articles of Association of operational creditor setting out takeover of Prompt Security Services is annexed alongwith.

b. It is submitted that in view of the statement made by the corporate debtor that the payment of the alleged invoice made, makes it unequivocally clear that the veracity of the invoices is admitted by the corporate debtor. It is pertinent to mention that if the payment is made to Prompt Security Services, then why the TDS has been deposited in the account of the operational creditor i.e Parnami Security and Manpower Services.

c. Furthermore when the status of the operational creditor changed, Corporate debtor was immediately informed and same is evident from the comparison of two Invoices, Wherein one was issued when the operational creditor was running its business as proprietorship concern and the other was issued when the operational creditor started running its business as company. It is pertinent to mention that the invoices dated 31.03.2009 and 30.04.2009 bears the details of the cheques issued by the corporate debtor to pay off its invoice amounts which can be evidently proved producing the details of the TDS returns for the year 2009.

d. In respect to the dispute in lieu of Invoice No. 1819203 and the same is against the agreement dated 20.02.2003:- It is submitted that had the invoice been disputed, corporate debtor would have disputed the same in its reply to demand notice or anytime before the demand notice was served but neither the reply to demand notice was ever given by the corporate debtor nor any dispute as to the said bill was raised before the demand notice was served. Furthermore, it is pertinent to mention that there is no bar on overtime in the above mentioned agreement and the same cannot be disputed. To substantiate the claim, operational creditor placed on record Bill No. 374 dated 31.03.2003 which was raised immediately after having the agreement of 2003, based on which, corporate debtor claims that the Over time is beyond the terms of Agreement of 2003. Also the said bill also bears the details of the cheque which was issued by the corporate debtor in satisfaction of the said Bill and the same was paid to the operational creditor. Copy of the Bill no. 374 dated 31.03.2003 placed on record.

e. It is pertinent to mention that the corporate debtor had not produced any single document to substantiate his stand that the payment had already been made in the account of Prompt Security Services/ Parnami Security and Manpower Services Private Limited. Thus the corporate Debtor filed its reply raising issue of frivolous nature issues in order to create moonshine dispute.

We have gone through the documents filed by the petitioner and heard the arguments made by the counsel of the petitioner. A persual of the correspondence indicates that there are no documents on record to show that the payment had already been made in the account of Prompt Security Services/ Parnami Security and Manpower Services Private Limited. Further various invoices and overtimes sheets were raised wherein the said invoices were duly accepted and used by the corporate debtor without any dispute in respect of qua the quality and objection regarding the deficiency of the services.

There has been much cloud in the submission of the respondent. Further there is nothing on record indicating the dispute to the operational creditor about the quality and deficiency of the services. It is pertinent to mention that in respect to the name and identity of the Operational Creditor, it is mentioned that M/s Parnami Security and Manpower Services Pvt. Ltd and M/s Prompt Security Services are one and the same thing and the said fact is well within the knowledge of the Corporate Debtor. Further the name in which the present petition has been initiated is in the name of the petitioner company, apart from that, invoices and letter heads itself mentions both names as well as the complete address of the operational creditor, so as to shed out any doubt as to identity of the operational creditor. When there is absolutely no document or particulars to support the claim of existence of dispute, the mere claim of dispute rose in the reply and in the pleadings in defence can be termed as vague and motivated to evade the liability. That the authenticity of facts can only be ascertained by supporting evidence and Mere submission would not be taken into consideration. The Hon'ble Supreme Court of India in the matter of Mobilox Innovations Private Ltd vs Kirusa Software Private Ltd has observed that:

Going by the above details the operational creditor has clearly established the existence of debt and default on the part of the corporate debtor. Hence this Tribunal initiates CIRP on the corporate debtor with immediate effect.

A moratorium in terms of Section 14 of the Code is imposed forthwith in following terms:

The Operational Creditor has not proposed the name of any IRP. Accordingly, we appoint Mr. Kumud Shekhar Registration No. IBBI/IPA-003/IP-N00206/2018-2019/12358 email--- [email protected] duly empanelled with the IBBI as the IRP. He shall take such other and further steps as are required under the statute, more specifically in terms of Section 15, 17 and 18 of the Code and file his report within 30 days.

The Operational Creditor is directed to deposit a sum of Rs. 2 lakhs to meet the immediate expenses of IRP. The same shall be fully accountable by the IRP and shall be reimbursed by the CoC, to the Operational Creditor to be recovered as CIR costs.