In the National Company Law Tribunal

Mumbai Bench.

C.P.(IB)-2860(MB)/2018

Under Section 9 Insolvency & Bankruptcy Code, 2016

In the matter of

M/s. Champion Dealers Private Limited : Petitioner/ Operational Creditor

Heard on 15.01.2019
Order delivered on: 28.01.2019
Coram:
Hon’ble Shri M.K. Shrawat, Member (Judicial)
For the Petitioner(s) : 1. Ms. Yashika Chhatani, PCS.
2. Mr. Pravin Mahajan, C.A.
For the Respondent(s) : 1. Mr. Amjith M. Abnandhan, Advocate, i/b.
Trima Legal.

Per M.K. Shrawat, Member (Judicial).

1. A Petition has been filed on 09.07.2018 by M/s. Champion Dealers Private

Limited in the capacity of Operational Creditor by invoking the provisions of Section 9 of

the Insolvency & Bankruptcy Code, 2016 against the Corporate Debtor M/s. Mohanlal

Mathrani Construction Private Limited, Pune – 411 045, to claim an outstanding

Operational Debt of ₹3,47,007/- claim as under:-

“Total Operational Debt : ₹ 3,96,759/-

Add: Interest : ₹ 3,47,019/-

Less: Received : ₹ 3,96,771/-

Net Balance receivable : ₹ 3,47,007/-”

2. Brief history of the case is as follows:-

3. The Petitioner alleged that the Corporate Debtor issued Purchase Orders

to the Operational Creditor during the Financial Year 2014-15 for supply of various

materials such as TMT 10 MM FE-500 UMA, TMT 12 MM FE – 500 UMA, TMT 16 MM FE

– 500 UMA, Binding Wire, M.S. Round 32 MM, etc.

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4. The Petitioner alleged that it had supplied the goods as per Purchase

Orders of the Corporate Debtor and raised Invoices.

5. The Petitioner further stated that the Corporate Debtor acknowledged the

receipt of the goods supplied by signing on various delivery challans during the

Financial Year 2014-15. One of the Terms mentioned on the Tax Invoices inter alia,

reads, as quote, “Interest @ 36% p.a. will be charged if the invoice is not paid by due

date.” unquote. The date of Default is claimed in the Petition as 05.01.2015.

6. Ledger Account of the Corporate Debtor in the Books of the Operational

Creditor is on record at Annexure 4 of the Petition.

7. The Petitioner had demanded the outstanding Debt amount of

₹3,96,759/- vide email dated 17.06.2015. It is admitted by the Petitioner that for the

Financial Years 2014-15 and 2015-16, the Corporate Debtor had made various

payments in the Bank Account of the Operational Creditor amounting to ₹6,03,944/-

against the Invoices raised. However, allegedly, still there is an outstanding Debt

amount of ₹3,47,007/-.

8. The Petitioner issued Demand Notice dated 20.03.2018 in Form No.3 on

the Registered Office of the Corporate Debtor by Speed Post demanding the balance

Debt amount of ₹7,43,778/-, which is inclusive of Interest component of ₹3,47,019/-.

9. As per the Statement of Account from 1st April, 2014 to 31st March, 2016,

placed on record, the Closing Balance is shown as ₹3,96,759/-. As per Statement of

Interest calculation as on 20.03.2018, the Principal amount has been shown as

₹3,96,759/- and Interest Amount ₹3,47,019/-.

10. As per ‘Part-V: Particulars of Operational Debt’, the net amount claimed to

be in default is ₹3,47,007/-. This appears to be only ‘Interest’ amount. The

Operational Creditor had received a reply dated 04.04.2018 from the

Corporate Debtor along with a Demand Draft for ₹3,96,771/-. It is mentioned

in the said reply that with this payment all the outstanding dues have been cleared by

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the Corporate Debtor. As per the Bank Certificate from Cosmos Bank dated 13.04.2018

placed on record, the amount of ₹3,96,771/-, received from the Corporate Debtor, has

been credited to the Cash Credit of the Petitioner Creditor.

11. Heard both the sides and perused the records. The Petitioner has

annexed a Statement to demonstrate that on what basis he has claimed the

outstanding Debt of ₹3,47,007/-. On perusal of this Statement, refer Page-13 of the

Petition, it is evident that the Principal amount which was in connection with the

Invoices raised amounted to ₹3,96,759/-. In this chart there is a separate calculation of

Interest. As per the calculation delay was calculated for each day and Interest @ 24%

is charged which amounted to total ₹3,47,019/-. As far as the Principal amount of

₹3,96,759/- is concerned, the admitted factual position is that the same had already

been paid by the Debtor to the Creditor. The Creditor has also acknowledged the

receipt of the said amount. Now the question left is about the charging of Interest, that

too, charging @ 24%. On one hand the Petitioner has pleaded that as per the Invoices

there was a clause of charging of Interest @ 36%, however, suo moto granting

concession, by charging the Debt amount on calculation of Interest only @ 24%. On

the other hand, from the side of the Debtor it is vehemently pleaded that as per the

Purchase Order there was no such clause of payment of Interest, that too at the

exorbitant rate of 36%. It was never agreed upon between the parties to pay the

Interest on the delayed payment. Attention has also been drawn that as far as the

question of Principal amount is concerned, the same stood paid; therefore, there is no

legal sanctity in filing Insolvency proceedings against the Debtor.

12. During the course of hearing, it was asked to the Petitioner whether the

Interest amount was shown on accrual basis as “accrued income” in its Books of

Accounts? No satisfactory reply was given. In a situation when the Petitioner has failed

to establish that on what basis claiming alleged Debt amount payable by the

Respondent Company, nothing was placed on record to substantiate the claim.

Admittedly, neither the Creditor has shown in his Books of Accounts the impugned

Interest as an ‘income’ for the said period, nor the alleged Corporate Debtor had shown

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in its Books of Accounts the Interest factor as a ‘Liability’ to claim expenditure on accrual

basis against the income of the year. In a situation when the alleged Interest has

neither been reflected by the Petitioner in its books of accounts as Receivable nor it is

reflected in the Books of Accounts as a Liability payable and also that the Debtor has

vehemently contested the charging of Interest in a situation when the Principal amount

is squared up after having some understanding among themselves, this Bench is of the

view that the Petition under consideration does not warrant to trigger the Insolvency

proceedings. As a consequence, the Petition stood “dismissed”. To be consigned to

Records.

Sd/-
(M.K. SHRAWAT)
Member (Judicial)
Date : 28.01.2019
ug

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