The court confirms that acknowledgment of debt and existence of a plausible contention regarding pre-existing disputes justify the admission of a petition for CIRP under the Insolvency and Bankruptcy Code.

ORDER

1. Under consideration before us is the petition filed by the Operational Creditor herein stating that M/s. Servomax Limited/ Corporate Debtor committed default of Rs.1,00,49,270/-. Hence this petition filed under Section 9 of Insolvency and Bankruptcy Code (hereinafter to be referred as “Code”), read with Rule 6 of Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, seeking admission of the Petition, commencement of Corporate Insolvency Resolution Process (CIRP), granting moratorium and appointment of Interim Resolution Professional as prescribed under the Code and Rules thereon.

2. The averments put forth by the Petitioner are:

2.1 It is averred that the Operational Creditor is a partnership firm registered as MSME commenced from 09.05.2016 with an objective to supply CRGO Laminations, DPC Copper Strip, DPC Copper wire, Pre-Comp Press Boards, S.E. Copper Wire, KV/630 AMP L.V, Kraft Paper on multiple occasions.

2.2 It is averred that the Corporate Debtor have issued multiple purchase orders and subsequently, issued multiple invoices for supply of CRGO Laminations, DPC Copper Strip, DPC Copper wire, Pre-Comp Press Boards, S.E. Copper wire, KV/250 AMP L.V, Kraft Paper. Copies of Purchase orders and invoices are filed as Annexure C and D.

2.3 It is averred that as the Corporate Debtor and the Operational Creditor had a long-standing business relationship, payments were made in installments. In due course, the debt fell due and the total outstanding amount due Rs.1,00,49,270/-. The Corporate Debtor issued various cheques in the month of August, 2022, totalling to Rs.39,93,625/- to partially clear the pending dues liable to be paid to the operational creditor. Copies of the cheques have been cumulatively annexed as Annexure-E.

2.4 It is averred that the Operational Creditor sent several messages through Whatsapp to the Corporate Debtor requesting for release of payment. However, the Corporate Debtor has not responded to the same. It is stated that the Corporate Debtor after multiple requests by Operational Creditor has issued 3 cheques. On presenting the cheque, all the Cheques were returned stating that the Account does not have sufficient funds to honour the Cheque. Copies of the Cheques along with memo of returned is files as Annexure-F.

2.5 It is averred that as the payments have not been made by the Corporate Debtor the Operational Creditor was constrained to issue Form 3 along with demand notice for payment of the outstanding amount of Rs.1,00,49,270/- plus interest @ 18% per annum. Copy of Form 3 along with Form 4 is filed as Annexure-G and Annexure-H. Copy of the acknowledgement card is filed as Annexure-I. The last payment received by the Corporate Debtor for the invoices received was on 15.12.2020.

3. The Corporate Debtor/Respondent filed counter, inter-alia stating that:

3.1 It is stated that the Petitioner/Operational Creditor is one of the suppliers for the Corporate Debtor out of a long-standing business relationship, and the Corporate Debtor is a reputed transformer manufacturing Business entity the Operational Creditor requested the Corporate Debtor to give orders for the supply of Copper & Core bushes so that the Petitioner can build its credentials as suppliers for an electrical eq