Milan Vasant Sanyasi vs Rolta Bl And Big Data Analysis Private Limited

Per: Suchitra Kanuparthi Member (Judicial)

This company Petition is filed by Milan Vasant Sanyasi (hereinafter called “Petitioner”) seeking to set in motion the Corporate Insolvency Resolution Process (CIRP) against Rolta BI and Big Data Analysis Private Limited (hereinafter called “Corporate Debtor”) alleging that the Corporate Debtor committed default in making payment to the extent of Rs.27,31,793 /-, principal being Rs. 23,75,472/- and interest amounting to Rs.3,56,321/-, by invoking the provisions of Section 8 and 9 of the Insolvency & Bankruptcy Code (hereinafter called "Code") read with Rule 5 and 6 of Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016.

The Petition reveals that the Petitioner was an employee working as a manager with the Corporate Debtor. The Petitioner served with the Corporate Debtor from 24.10.1994 to 04.02.2019. The Petitioner was forced to leave the services of the Corporate Debtor on 04.02.2019.

The Petitioner was forced to be relieved from the services of the Corporate Debtor. However, the salary allowances and other due and payable amounts including the statutory provident fund and TDS amounts and the post-retirement benefits were not paid to the Petitioner.

The Petitioner on 20.12.2019 issued a demand notice to the Corporate Debtor, Under Section 8 of the Code, demanding a sum of Rs. 24,27,312/-. There was no reply from the Corporate Debtor for the Demand Notice.

The Petitioner submits that on 20.03.2019 the Corporate Debtor sent a full and settlement report to the Petitioner but till date no settlement has taken place. The final settlement report of the Corporate Debtor is reproduced below:

The Corporate Debtor submits that the Application in the contravention of Section 10A of the Code, 2016. The said Application is misconceived frivolous, vexations, baseless and has been filed in abuse of process of the Code and thus liable to be dismissed.

The Corporate Debtor submits that there are around 40 other Applications filed by the other employees of the Corporate Debtor for the claims of similar nature and that too through the same advocate on record, the Respondent proposed to hold without prejudice discussions with all the Applicants to arrive at an amicable settlement with all employees concerned. Accordingly, on the last date of hearing, the Corporate Debtor undertook to facilitate meetings between the concerned applicant-employees, and the concerned personnel from the Human Resources (HR) department of the Corporate Debtor.

The Corporate Debtor’s HR Department and other depts. staff test positive for COVID-19, as the Corporate Debtor’s office operating without sufficient staff and working only with skeletal support for its clients forming part of essential services. The Corporate Debtor annexed the details of the employees who test positive along with their medical reports.

After the mandatory quarantine period of certain senior employees in the HR department was completed and the minimum staff support was available for accessing records, a schedule was proposed by the advocates of the Corporate Debtor to hold personal / one to one discussion between the respective employees on a designated date & time. The said schedule was shared with the advocates for such employees for confirmation and comments, if any, vide email dated 03.04.2021.

In response, the advocates for the concerned employees addressed an email/letter dated 05.04.2021 inter alia accepting the proposed schedule, and agreeing to hold discussions between the concerned employees and the personnel of the HR department.

In pursuance of the aforesaid, the concerned employees and Respondent, through their advocates, have exchanged correspondence on 05.04.2021 on the status of the proposed meetings. Furthermore, in accordance with the proposed schedule, the Respondent (through its HR Dept.) has held meetings with the following’s employees till date:

The discussions are ongoing at the time of filing this present Affidavit in Reply and the same is expected to conclude in two weeks. Notably, the delay caused in arriving at a settlement with the Applicants is due to the fact that the Respondent endeavors to settle with all of its employees together, without giving preferential treatment to any one of its employees, coupled with the guidelines and restrictions imposed by the government on account of the present COVID–19 Pandemic.

In the present case, the Applicant has annexed and relied upon the Statement of Account of the Applicant maintained with a banking company.

Bankers’ Books Evidence Act, 1891 (‘BBE Act’) is a complete code for the law of evidence with respect to Bankers' Books i.e., ledgers, day-books, cash-books, account-books and all other books used in the ordinary course of business of a bank. The provisions of the BBE Act specifically provide the mode, manner and method in which bankers’ books and entries therein are to be proved.

Any entry in a banker’s books to be taken as prima facie evidence of the existence of such entry, and to be admitted as evidence of the matters reflected therein, should strictly comply with the provisions of the BBE Act.

More particularly, the BBE Act provides that any entry to be admitted as evidence of the matters reflected therein should be furnished as a certified copy. Furthermore, such certified copies of bankers’ books should be meet the requirements laid down in Section 2A of the BBE Act. The relevant provisions of the BBE Act are reproduced herein for reference:

In summary, the scheme of the BBE Act provides that a certified copy of any entry in a bankers’ books shall be considered as prima facie evidence of the transactions and accounts stated therein. Furthermore, the BBE Act provides that printout of any entry or copy thereof shall be accompanied by-

certificate to the effect that is a printout of such entry by the principal accountant or branch manager (‘First Certificate’); AND

certificate by a person in-charge of a computer system containing a brief description of the computer system and particulars thereof as prescribed under BBE Act (‘Second Certificate’); AND

a further certificate from the person in-charge of the computer system to the effect that to the best of his knowledge and belief, such computer system operated properly at the material time, he was provided with all the relevant data and the printout in question represents correctly or is appropriately derived from, the relevant data. (‘Further Certificate’);

In light of the above, and more particularly in view of the fact that the Applicant has failed to furnish any of the certificates as required under the BBE Act, the aforesaid documents cannot be taken into evidence or be treated as proof of any transaction set out therein.

Corporate Debtor further submits that the Petitioner is bound to produce documentary proof evidencing that there is no payment of an unpaid operational debt in the manner provided under the Code and Rules made thereunder.

Considering the aforesaid, as well as the present Application along with its exhibits, it is humbly submitted that Applicant has failed to submit any proof of debt/default. As a result of this, the Application filed by the Applicant is incomplete and thus deserves to be rejected with cost.

The Petitioner in the present Application has claimed an amount of Rs.27,31,793/- towards alleged outstanding dues. The Applicant has included an amount of Rs.60,858/- in the aforesaid claim amount towards statutory dues.

It is submitted that the statutory dues being payable directly to the respective authorities, the Applicant is falsely claiming the same to exaggerate the claim amount.

It is well settled law that the Applicant is entitled to claim interest under the Insolvency and Bankruptcy Code, 2016 only when the same is contractually agreed between the parties.

Further, it is submitted that according to the company policy, more particularly, Clause 11 of the Exit and Final Settlement Procedure specifically states that in case of any delay in crediting the pending salary or the full and final settlement amount or any other dues to the ex-employee, no interest will be payable by the Company for the delayed period.

Thus, in the present case the Applicant is not entitled to claim any interest from the Corporate Debtor.

The petition is filed by one of the Ex-Employee of the Corporate Debtor Named Milan Vasant Sanyasi who worked with the Corporate Debtor as Manager from 24.10.1994 to 04.02.2019. The Petitioner was forced to leave his employment with the Corporate Debtor and the Corporate Debtor relieved the Petitioner on 04.02.2019.

The Corporate Debtor did not make payment of salaries and allowances for the period November, 2018 to January, 2019 to the Operational Creditor amounting to Rs.2,27,749.00 and also notice period payment, leave encashment and gratuity, in all, amounting to Rs.24,27,312.00. An amount of Rs.43,290.00 was deducted from the salary of the Operational Creditor as and by way of TDS from April, 2018 to January, 2019. However, the same was not deposited by the Corporate Debtor with the concerned Income Tax Department, Though Provident Fund contributions of employer and employee amounting to Rs.16,368.00 were deducted by the Corporate Debtor, the same was not credited to the concerned Provident Fund Authorities by the Corporate Debtor.

Corporate Debtor, vide its letter dated 14^th December, 2018, unconditionally agreed to make payment of interest @18 % per annum on overdue salaries to the Operational Creditor from October, 2018 onwards in January, 2019. Neither the overdue salaries were paid nor the interest was paid. The Petitioner is entitled to payment of interest. Thus, various substantial amounts by way of unpaid salaries and other due and payable amounts and also amount deducted to pay to the Government Authorities and not deposited despite the passage of nearly three years are payable by the Corporate Debtor. Letter of Corporate Debtor dated 14.12.2018 is reproduced below:

The final Settlement report as furnished by the Corporate Debtor to the petitioner shows the following total amounts that have been ADMITTED as payable by the Corporate Debtor on the last date of employment of the Operational Creditor with the Corporate Debtor. The Relieving Letter, in the Full and Final Settlement Report dated 20th March, 2019 captures the following figures:

The amounts that have been claimed by the Petitioner in his statement of claim in Annexure-I to the Company Petition on page 10 shows the same amounts, as follows:

Slight differences exist due to record mismatch; however, most of the amounts claimed by the Operational Creditor is an admitted liability by the Corporate Debtor. The remaining amounts claimed by the Petitioner are as follows:

This bench is of the considered opinion that the petitioner was an employee and has a legitimate right to claim the unpaid salary dues as claimed by the Petitioner. The Corporate Debtor has no grounds of defence except that a) settlement process is going on b) the petition is incomplete c) the account statement is unaccompanied by certificate as issued by Bankers Books of evidence, d) Proof of default. The Corporate Debtor issued a final settlement report which captures certain amounts payable to the Petitioner and the rights of the petitioner to receive his monthly emoluments/salary till the date of resignation cannot be denied by the Corporate Debtor. Bank Statements shows payment of Rs. 77,557.00 on 27.11.2018 for the Month of October, 2018. No other credits appeared in this Bank Statement till, April 2019. Further the Corporate debtor has deducted the TDS and not paid to the Department.

On account of these defaults, the Operational Creditor has received tax notices and intimation under Section 143 (1) and was levied fines and penalties, which ought to be paid by the Corporate Debtor. These amounts are also to be included in the recoverable from the Corporate Debtor, since it arose after the filing of the Company Petition.

The Demand Notice was sent on 20th December, 2019 and received by the Corporate Debtor on 28^thJanuary, 2020. Company Petition was filed on 26^th February, 2020 well before the lockdown. The Petition was within the threshold limit as prescribed under section 4 of the Insolvency and Bankruptcy Code, 2016. The claim of the counsel for the Corporate debtor that the petition is not maintainable on this ground is untenable.

The matter was earlier listed on various occasions and thereafter the matter was listed on 19.02.2021 on that Hon’ble bench observed that Many of the matters have already been come up for hearing. The bench provided sufficient opportunity to the Counsel for the Corporate debtor to settle the matter amicably. Thereafter on 16.04.2021, the matter was heard and Reserved for Orders.

This bench is of the considered view that the petitioner was employed on the rolls of the Corporate Debtor and the Corporate Debtor defaulted in payment of salaries, hence the petition is Admitted.

This Bench having been satisfied with the Petition filed by the Petitioner which is in compliance of provisions of Section 8 & 9 of the Insolvency & Bankruptcy Code, admits this Petition, declaring Moratorium with the directions as mentioned below:

The Registry is hereby directed to communicate this order to both the parties and to the Interim Resolution Professional immediately.