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Judgment
Per M.K. Shrawat, Member (Judicial).
A Petition u/s.9 has been submitted in Form No.5 on 17.04.2018 by the Operational Creditor M/s. SKM Steels Limited, against the Corporate Debtor M/s. Nirmiti Stampings Pvt. Ltd., Pune for an Operational Debt of ₹57,00,656/- Plus Interest @ 24% ₹17,00,949/- totalling ₹74,01,605/-, reproduced below:-
The Petitioner/ Operational Creditor has submitted:-
That, the Operational Creditor Company is in the business of steel trading and the Corporate Debtor is in the business of Manufacture of Precision Metal Stamping, Parking Brake Levers, Sheet Metal Stampings, Shock Absorbers and Sheet Metal & Turned Components.
That, the Operational Creditor supplied H.R. Pick Coil and H.R. Coil to the Corporate Debtor from 21.02.2016 to 31.03.2017 and raised Sales Invoices on the Corporate Debtor aggregating to Rs.57,00,656/- as per the Purchase Orders purportedly placed by the Corporate Debtor.
That, Interest of Rs.17,00,949/- was charged @ 24% p.a. and the total outstanding amount including Interest worked out to Rs.74,01,605/-.
That, since the outstanding amount was not paid by the Corporate Debtor, on 13.02.2018, the Petitioner Creditor sent a Demand Notice to the Corporate Debtor demanding the outstanding amount. However, the Demand Notice was stated to be returned as "left" from the address.
That, as a consequence, the Operational Creditor sent Demand Notice in the name of the Directors of the Corporate Debtor, viz. Mr. Haresh Naik and Mrs. Sarika Talegaonkar, on the address of the Corporate Debtor mentioned in the MCA portal, however, the same was also returned as "left" and "unclaimed". Thereafter the Demand Notice was allegedly sent in the Factory address of the Corporate Debtor which is stated to have been acknowledged by the Respondent.
MR- Harish Naik C/o Nirmiti stampings Pvt Ltd 11512, General Block Mide, Bhosani Pune - 4110026
That, the Bank Statement of the Corporate Debtor, issued by the Bank of India, for the period from 01.03.2017 to 31.03.2017 is placed on record.
That, from the date of delivery of goods till date, no notice of dispute was raised by the Corporate Debtor or any communication had been received from the Corporate Debtor in this regard.
3. Submissions from the side of the Respondent Debtor:-
From the side of the Respondent Debtor, it was submitted in the written statement that the goods supplied to the Corporate Debtor were of bad quality due to which it was causing great loss to the business of the Corporate Debtor and also affected the goodwill of the Corporate Debtor. Therefore, the Corporate Debtor decided to discontinue the supply of the said goods from the Operational Creditor.
That, the Corporate Debtor requested the Operational Creditor to take back the goods supplied as the same were bad in quality and also damaged, thus not competent to supply to outsiders. However, the same were not taken back by the Operational Creditor.
The Corporate Debtor further submitted that the goods delivered were not as per purchase order and also not as per the quality assured by the Operational Creditor. In support, Two email communications dated 15.09.2015 and dated 12.03.2016 addressed to the Operational Creditor have been placed on record by the Corporate Debtor, as below:-
That, the conclusion in the Lab Report submitted by the Respondent Debtor says, quote: "Conclusion: The above Sample Conforms to IS 1079:2009:HR2(D), Tensile 1 only", unquote.
The Respondent Debtor claimed that the Operational Creditor never sent demand notice to Haresh Naik and Sarika Talegaonkar, Directors of the Corporate Debtor, as claimed by the Operational Creditor. The Respondent further alleged that the Operational Creditor has not produced the email communication papers; also not produced the debit note dated 19.04.2017; not cleared the material rejection note with sample report dated 09.04.2017 of an amount of Rs.2,74,519.71.
Rejoinder by the Petitioner/ Operational Creditor :-
The Petitioner/ Operational Creditor in Rejoinder dated 14.02.2019 submitted its rebuttal of the allegations of the Corporate Debtor, refuting the allegations for want of documentary evidence. According to the Petitioner, the objection raised by Respondent Debtor in Para No.21 of the Reply submitted that the purported objection raised vide letter dated (blank), has not been received by the Operational Creditor nor Corporate Debtor himself is aware about the date of such objection letter raised by him or such letter is enclosed with the affidavit in reply. Petitioner vehemently pleaded that from the date of delivery of goods till date of filing Petition no notice of dispute has been raised by the Corporate Debtor nor the Operational Creditor received any communication from the Corporate Debtor regarding any dispute. The Petitioner also alleged that several Invoices have not been considered in the Ledger of the Corporate Debtor. As regards Para 24 of the reply of the Corporate Debtor, Petitioner submitted that the alleged Debit Note for Rs.2,74,519.71 has already been considered in the ledger of Operational Creditor.
Petitioner also submitted that the Corporate Debtor in their email dated 03.02.2017 had 'admitted' that the outstanding amount in 2017 was Rs.50,00,000/-.
FINDINGS:-
Considering the facts and circumstances of the case, it is evident that the Petitioner had issued Demand Notice to the Respondent Debtor. However, the same was returned twice undelivered citing the reason "left". Thereafter, the Petitioner issued Demand Notice at the factory address of the Respondent Debtor Company to Mr. Harish Naik, one of the Directors of the Corporate Debtor Company, discussed in Para 2.5 (supra). Petitioner has submitted a proof of acknowledgement of this communication. This case was first listed on 10.07.2018, 23.08.2018, 22.10.2018, 10.12.2018, 21.01.2019, 28.02.2019, 02.05.2019, 08.07.2019 and lastly on 19.08.2019. Even after a lapse of considerable time after first listing of this Petition, no serious effort appeared to have been made by the Corporate Debtor to settle the outstanding amount.
From the side of Respondent Debtor, on 10.12.2018, an Advocate appeared and sought time for filing Vakalatnama. Time was granted subject to payment of cost of Rs.20,000/-, to be paid to the Petitioner and matter was adjourned to 21.01.2019.
The Corporate Debtor has submitted evidence of short supply of goods by the Operational Creditor as per para 3.3 (supra) and the quality of the goods supplied. As a consequence, the Corporate Debtor has allegedly raised Credit Note amounting to Rs.2,74,520/- on 09.04.2017. The said Credit Note has been accounted for in the books of the Petitioner on 09.04.2017. However, the Resolution Professional shall reconcile the minor difference appearing in the Closing Balance of Rs.57,00,656/-appearing in the Ledger Accounts of the Petitioner/ Operational Creditor with the Closing Balance of Rs.48,87,699.51 appearing in the Ledger Account of the Respondent Debtor.
As a consequence, keeping the admitted facts in mind that, the Operational Creditor has not received the outstanding Debt from the Corporate Debtor and that the formalities as prescribed under The Code have been completed by the Petitioner/ Operational Creditor, it is our conscientious view that this Petition deserves "Admission".
The Operational Creditor has proposed the name of Interim Resolution Professional Mr. Prakash Dattatraya Naringrekar, Registration No. IBBI/IPA-002/IP-N00270/2017-2018/10783, Address: 503-A, Blue Diamond CHS Ltd. Chincholi Bunder/ Link Road Junction, Malad (West), Mumbai - 400 064. The IRP has submitted his consent in Form No.2 and also certified that no Disciplinary Proceedings are pending against him. Accordingly, this Bench appoints the said IRP Mr. Prakash Dattatraya Naringrekar to initiate Corporate Insolvency Resolution Process against the Corporate Debtor.
Upon Admission of the Application and Declaration of "Moratorium" the Insolvency Process such as Public Announcement etc. shall be made immediately as prescribed under section 13 read with section 15 of The Code. He shall perform the duties as an Interim Resolution professional as defined under section 18 of The Code and inform the progress of the Insolvency Process and the compliance of the directions of this Order within 30 days to this Bench. A liberty is granted to intimate even at an early date, if need be.
Having admitted the Petition/ Application the provisions of "Moratorium" as prescribed u/s. 14 of The Code shall come into operation. As a result, institution of any suit or parallel Proceedings before any Court of Law are prohibited. The assets of the Debtor must not be liquidated until the Insolvency Process is completed. However, the supply of essential goods or services to the Corporate Debtor shall not be suspended or interrupted during "Moratorium Period". This direction shall have effect from the date of this Order till the completion of Insolvency Resolution process.
Accordingly, this CP (IB)-1527/(MB)/2018 stood "Admitted".
The Corporate Insolvency Resolution Process shall commence from the date of this order.