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2025 Supreme(Online)(NCLT) 3956
NATIONAL COMPANY LAW TRIBUNAL
Smt. Lakshmi Gurung, Member (Judicial), Shri Hariharan Neelakanta Iyer, Member (Technical)
Xanadu Realty Limited – Appellant
Versus
T Bhimjyani Realty Private Limited – Respondent
Section 9 of the Insolvency and Bankruptcy Code, 2016
For the Appellants/Petitioners: Sr. Adv. Mr. Ashish Kamat, Adv. Subhradeep Banerjee, Adv. Avishkar Sawant, Adv. Pankaj Parakh i/b. Mithun Khaire
For the Respondents: Adv. Nausher Kohli, Adv. Prerak Choudhary, Adv. Trisha Ranka
A pre-existing dispute must be genuine and timely raised. Failure to comply with contractual obligations or raise objections within stipulated time negates the defense in insolvency proceedings under the Code.
Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Section 9 - Petition for initiation of Corporate Insolvency Resolution Process filed by the Operational Creditor against the Corporate Debtor - The issue of pre-existing dispute regarding operational debt arose due to earlier contractual disagreements - The Corporate Debtor failed to raise timely objections to invoices, resulting in deemed acceptance of debt - Tribunal found that the alleged disputes pertained to previous agreements and not the current one. (Paras 27, 34, 70)
(B) Dispute Resolution - Timely and genuine raising of disputes is essential for maintaining the prerogative of referring issues to arbitration - The Corporate Debtor invoked dispute resolution processes in the prior agreement but could not assert them in the current proceedings. (Paras 49, 70)
(C) Nature of Dispute - The existence of true disputes must be antecedent to the demand notice, failing which the insolvency application is not maintainable - The Tribunal cannot resolve triable issues and must focus on clear evidence of debt and default as prescribed by the Code. (Paras 64, 70)
Facts of the case:
The Operational Creditor filed for insolvency resolution against the Corporate Debtor for non-payment of outstanding invoices totaling Rs. 3,73,66,865/- - The Corporate Debtor alleged pre-existing disputes relating to service provided under earlier agreements which were settled.
Findings of Court:
The Tribunal determined that unresolved issues pertained to earlier agreements and not the invoicing under the current contract - Therefore, as the necessary conditions for Section 9 proceedings were not met, the application was rejected.
Issues: The Tribunal needed to assess whether a bona fide dispute existed that would bar the initiation of CIRP and if the Corporate Debtor had complied with dispute resolution mechanisms stipulated within their contract.
Ratio Decidendi: The Tribunal emphasized that disputes must be genuine and timely raised, as outlined in various clauses of the agreement, underscoring that reliance on historical grievances that have been previously settled will not prevent an operational creditor’s application for insolvency proceedings when there is an established debt.
Result: The present Company Petition is rejected.
| Table of Content |
|---|
| 1. factual basis for the corporate insolvency resolution process (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8) |
| 2. parties’ arguments on the existence of dispute (Para 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 19 , 20 , 21 , 22 , 23 , 24) |
| 3. context of previous agreements and their relevance (Para 18) |
| 4. detailed examination of exchange of communications (Para 25) |
| 5. court's analysis of the evidence provided (Para 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33) |
| 6. considerations of contractual disputes (Para 34 , 35 , 36 , 37 , 38) |
| 7. operational creditor's rebuttals to corporate debtor's claims (Para 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49) |
| 8. framing of disputes under respective agreements (Para 50 , 51 , 52 , 53 , 54 , 55 , 56) |
| 9. highlights of reconciliation attempts (Para 57 , 58 , 59 , 60) |
| 10. court's stance on dispute resolution obligations (Para 61 , 62 , 63 , 64 , 65 , 66) |
| 11. rejection of the application based on existing disputes (Para 67 , 68 , 69) |
| 12. conclusion of the tribunal's findings (Para 70 , 71) |
Per: Ms. Lakshmi Gurung, Member (Judicial)
1. This Petition has been filed by Xanadu Realty Limited (‘Operational Creditor’) against T Bhimjyani Realty Private Limited (“Corporate Debtor) to initiate Corporate Insolvency Resolution Process (“CIRP”) 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.
Brief Facts as set out in the Petition:
2. The Operational Creditor is a registered real estate agent having registration number A51900000593 under the provisions of RERA, 2016 . The Operational Creditor entered into a service agreement dated 21.10.2022 for providing and rendering real estate sales, marketing and project management consultancy services (referred to as ‘2022 Agreement’) with the Corporate Debtor. The Corporate Debtor had availed the services of the Operational Creditor for its project Neelkanth Woods (Verraton) registered with MahaRERA bearing registration number PS 1700021698 (‘the Project’) as per the Agreement. Subsequently, invoices were generated for the services provided by the Operational Creditor to the Corporate Debtor including the retainer fee and service fee as envisaged in the Agreement.
3. The Operational Creditor had raised 13 (thirteen) invoices on the Corporate Debtor during the period from 16.11.2022 to 26.12.2023 as per details given below:
| Sr. No. | Date | Invoice Details | Amount in Rs. including taxes |
| 1. | 16.11.2022 | 22-23/XRL/RF/062 | 1,08,00,000 |
| 2. | 22.12.2022 | 22-23/XRL/SF/224 | 3,87,377 |
| 3. | 05.01.2023 | 22-23/XRL/SF/239 | 14,85,359 |
| 4. | 03.02.2023 | 22-23/XRL/SF/267 | 29,81,195 |
| 5. | 03.03.2023 | 22-23/XRL/SF/296 | 52,55,969 |
| 6. | 02.04.2023 | 23-24/XRL/SF/002 | 1,10,03,603 |
| 7. | 03.05.2023 | 23-24/XRL/SF/050 | 37,70,651 |
| 8. | 06.06.2023 | 23-24/XRL/SF/109 | 72,31,783 |
| 9. | 03.07.2023 | 23-24/XRL/SF/141 | 1,28,83,317 |
| 10. | 03.08.2023 | 23-24/XRL/SF/180 | 23,36,355 |
| 11. | 04.09.2023 | 23-24/XRL/SF/210 | 41,97,582 |
| 12. | 05.10.2023 | 23-24/XRL/SF/260 | 13,17,310 |
| 13. | 26.12.2023 | 23-24/XRL/SF/240 | 6,70,294 |
| Total | 6,43,20,795 |
4. The invoices dated 16.11.2022, 22.12.2022, 05.01.2023, 03.02.2023, 03.03.2023 (Sr No. 1-5) have been paid in full. However, the balance invoices are either not paid or paid in part. The balance principal amount outstanding as on 22.01.2024 is Rs. 3,73,66,865/-.
5. As per the invoices and Agreement terms, delayed payments would attract interest charges. Clause 2 and 3 of the remarks section of the invoices states that the payment has to be made within 30 days from the date of invoice, and in the event of any delayed payment, interest would be charged at 1% per month compounded annually. Further, Clause 8.1 under Annexure I of the Agreement envisages the service fee calculated at 5.5% of the net revenue.
6. Clause 4 of the remarks section of the invoices further envisages that in the case of any queries, the same has to be raised within seven working days of receipt, failing which the amount mentioned in the invoice will be deemed accepted by the Corporate Debtor.
7. As per the peti
