The failure to serve a valid demand notice under the Insolvency and Bankruptcy Code renders the application for insolvency proceedings non-maintainable.

ORDER

PER: MANNI SANKARIAH SHANMUGA SUNDARAM, MEMBER (JUDICIAL)

1. This is a Company Petition filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (‘the Code’) read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 by Arihant Traders through its Partner Milind Joharapurkar (‘Operational Creditor’), for initiation of Corporate Insolvency Resolution Process (‘CIRP’) against M/s Giesecke & Devrient India Private Limited (‘Corporate Debtor’)

2. M/s Arihant Traders through its Partner Milind Joharapurkar (Operational Creditor) is a company registered under the provisions of the Companies Act, 1956, having its registered office at 47/A, Dr. Bhiwapurkar Marg, Dhantoli, Nagpur (M.H.)- 440012. M/s Giesecke & Devrient India Private Limited (Corporate Debtor) is a company registered under the Companies Act, 1956 [CIN: U74999DL2001PTC127080], having its registered office at Plot No. 218, Block-A, Okhla Industrial Are, Phase-I, New Delhi, Delhi-110020. The Corporate Debtor has Authorized Share Capital of Rs. 3,10,00,000 and Paid-Up Share Capital of Rs. 2,16,16,000 (Rupees Nine Lakhs Thirty-Five Thousand Only).

3. The total amount due as claimed is Rs. 22,74,190/- (Rupees Twenty-Two Lacs Seventy-Four Thousand One Hundred Ninety Only). The date of default is stated to be 11.04.2016.

4. Submissions by the Ld. Counsel appearing on behalf of the Operational Creditor

i. The Applicant was engaged as a Channel Partner of the Corporate Debtor for the sale and after sale service of its ‘Bank Note Processing System’. On 07.01.2013 the a ‘non-disclosure’ and a ‘Restricted use’ agreement was executed and subsequently on 19.10.2015 the ‘Channel Partner Agreement’ was executed. There are two bifurcations in-terms of payment a. Products: where advance payments were to be made b. Services: where invoices were raised after the Corporate Debtor issued ‘payouts’

ii. In terms of clause 7 of the ‘Channel Partner Agreement’ i.e., the “Payment Term” dated 19.10.2015, the ‘Channel partner’ i.e., the applicant herein was to make advance payments for the products it purchases from the Corporate Debtor/Respondent for selling in the contractual territory. Payment for services which included installation, Warranty Maintenance, Annual Maintenance, etc. were to be made according to Annexure IV of the ‘Channel Partner Agreement’.

iii. In accordance with the work done, the requisite invoices were issued as regards which the payments are due to the Applicant from the Corporate Debtor. It is relevant to state as per the abovementioned Channel Partner Agreement, the Corporate Debtor would issue ’payouts’ (containing details as regards the various aspects of services of the Bank Note Processing Systems, including - Annual Maintenance Contract, Installation Charges, Warranty Services etc.) on the basis of which the Operational Creditor / Applicant would raise the invoices. It is also added that since the Corporate Debtor operated centrally through its Channel Partners - the invoices could be raised only on the express instructions of the Corporate Debtor.

iv. Accordingly, on issuance of payouts by the Corporate Debtor to the Applicant, they would raise invoices for the services rendered. On the basis of the services rendered, invoices in issue were duly raised by the Operational Creditor on the Corporate Debtor. Therefore, a debt to the extent of Rs. 22, 74,190/- excluding the interest is owed by the Corporate Debtor to the Operational Creditor. It is relevant to state that a payment of Rs. 7,90,792/- (Rs. Seven Lakhs Ninety Thousand Seven Hundred and Ninety-Two only) was made on 30.08.2017 pursuan