ORDER

Per: Manoj Kumar Dubey, Member (Technical)

1. The present petition is filed on 02.11.2022 under section 9 of the Insolvency and Bankruptcy Code, 2016 (for brevity ‘IBC’/Code), r/w. Rule 6 of the I&B (Application to Adjudicating Authority) Rules 2016, by M/s. SSIPL Lifestyle Pvt. Ltd (for brevity ‘Operational Creditor/Petitioner’) inter alia seeking to initiate Corporate Insolvency Resolution Process against M/s. Counfreedise Retail Services Limited (hereinafter referred as ‘Corporate Debtor/Respondent’) on the ground that the Corporate Debtor has committed a default for an outstanding amount of Rs. 14,23,13,994/- including the interest. The date of default mentioned in Form 5 is 19.03.2020.

2. Brief facts of the case, which are relevant to the issue in question, are as follows:

i. The Operational Creditor and the Corporate Debtor entered into a business agreement dated July 5, 2017 in terms of which the Operational Creditor supplied "Lotto" brand products to the Corporate Debtor for sale by the Corporate Debtor through various e-commerce platforms and retail channels including "Buymore”.

ii. The Corporate Debtor breached terms & conditions of the Agreement by changing the selling price of the Products and also consistently defaulted in making timely payments to the Operational Creditor.

iii. Due to the repeated defaults of the Corporate Debtor in making timely payments to the Operational Creditor, as on March 19, 2020 (date of default), there was an outstanding amount of Rs. 11,14,73,900/- (Rupees Eleven Crores Fourteen Lakhs Seventy Three Thousand Nine Hundred only) as per the running ledger account of the Operational Creditor which was immediately due and payable by the Corporate Debtor to the Operational Creditor.

iv. The Operational Creditor vide notice of termination sent by email on April 27, 2020 ("Termination Notice") terminated the Agreement with immediate effect demanding the outstanding payment of Rs. 11,14,73,900/- (Rupees Eleven Crores Fourteen Lakhs Seventy Three Thousand and Nine Hundred only). The Corporate Debtor replied to the Termination Notice vide email of April 28, 2020, wherein the Corporate Debtor did not dispute the outstanding amount and has admitted to the reconciliation prepared by the respective teams of the Operational Creditor and Corporate Debtor. The total amount of admitted debt, which the Corporate Debtor is liable pay to the Operational Creditor, is as under:

a. Rs. 11,14,73,900/- (Rupees Eleven Crores Fourteen Lakhs Seventy Three Thousand Nine Hundred only) as stated above; and

b. Rs. 3,08,40,094/- (Rupees Three Crores Eight Lakhs Forty Thousand and Ninety Four only) towards interest @18% per annum payable by the Corporate Debtor upon the total outstanding amount calculated from the date of default i.e., March 19, 2020 till October 1, 2021.

v. Total Outstanding along with interest as on date: Rs. 14,23,13,994/- (Rupees Fourteen Crores Twenty Three Lakhs Thirteen Thousand Nine Hundred and Ninety Four only).

vi. Statutory demand notice under section 8 of the Insolvency and Bankruptcy Code, 2016 was issued by the Operational Creditor on October 6, 2021 and was successfully delivered to the Corporate Debtor through courier on October 9, 2021 and through speed post on October 12, 2021.

vii. The Corporate Debtor has neither replied to the said demand notice raising any pre-existing dispute nor made any payment towards the unpaid operational debt.

3. The Learned Counsel for the Respondent filed statement of objection dated 11.04.2022 contending that the termination notice was issued by Operational Creditor to Corporate Debtor on 05/04/2020, demanding Rs.11,14,73,900/- as on 31st March 2020 and as per the Notice of Demand Letter dated 19/11/2020 the demand was made for Rs.8,25,05,092/- as on date as per their own books and there is no explanation. The Corporate Debtor had suitable replied stating that outstanding as per their ledger is Rs. 58,25,144/- only that to in the form of stock of Corporate Debtor