The court determined that a corporate insolvency petition was not maintainable due to non-compliance with Section 10A's threshold requirements during the lockdown period.

Per: LAKSHMI GURUNG, MEMBER (J)

1. This Company petition is filed by IL & FS Engineering and Construction Company Limited (hereinafter called as “Operational Creditors/IECCL/Petitioner”) seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Offshore Infrastructures Limited (hereinafter called as “Corporate Debtor/Respondent”) by invoking the provisions of Section 9 Insolvency and bankruptcy code (hereinafter called “Code”) read with Rule 6 of Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016.

2. Brief facts leading to filing of the present petition

2.1. The Operational Creditor and Corporate Debtor entered into an agreement dated 26.03.2019 for hiring of construction equipment on monthly dry rent basis vide W.O. No. OIL/JDPL/HIRE/002 (“work order”) for project site at Ratnagiri on the terms and conditions contained therein for a period of 6 months.

2.2. Pursuant to the said work order, Operational Creditor provided the machinery to the Corporate Debtor at its project site and Operational Creditor accordingly raised its Invoices from time to time starting from the month of April 2019 till the month of August 2020.

2.3. The Corporate Debtor in spite of using the said construction equipment, had been negligent and irregular in making the payment of the Invoices which were raised by Operational Creditor from the month of June 2019 onwards. It was only after repeated requests and tremendous follow ups vide various emails dated 31.07.2019, 09.09.2019, 21.10.2019, 21.10.2019, 05.11.2019, 08.01.2020, 22.01.2020 addressed by Operational Creditor to the Corporate Debtor, that the Corporate Debtor made part-payments of the outstanding invoices between the period July 2019 to January 2020.

2.4. The Corporate Debtor while making the part-payments towards the outstanding invoices, had been admitting to Operational Creditor their liability to make the payment towards the outstanding invoices. Operational Creditor continued to follow up with the Corporate Debtor and vide its letter dated 08.01.2020 asked the Corporate Debtor to return the equipment to Operational Creditor in good condition.

2.5. Due to the Covid-19 pandemic, Operational Creditor raised its invoices for the months of March 2020 to May 2020 in the month of June 2020. At time, the Corporate Debtor initially requested that the said invoices be revised and also claimed that as the said machines were not in operations, the invoices were not acceptable. Since this was clearly against the terms and conditions of the work order, Operational Creditor did not accept the said request and the same was accordingly communicated to the Corporate Debtor, the Corporate Debtor was also called upon to make the payments immediately. The Corporate Debtor at that instance for the very first time by their email dated 10.07.2020 addressed to Operational Creditor alleged that the invoices submitted for payment are required to be certified from the site to enable them to release the payment. The said fact has been disputed and duly responded to by the Operational Creditor by their email of even date addressed to the Corporate Debtor. However, to ensure that the payments are released, the invoices raised by Operational Creditor for the period March 2020 to May 2020 were certified at site and the same was intimated to the Corporate Debtor vide email dated 21.07.2020.

2.6. Operational Creditor vide its letter dated 28.08.2020 called upon the Corporate Debtor to pay its outstanding dues within 15 days and invoked clause 28 of the Work Order, terminating the said Work Order and called upon the Corporate Debtor to handover the equipments in good working condition.

2.7. Between August 2020 and September 2020, Operational Creditor raised concerns by t