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Dispute raised by the CD isn't a spurious or legally feeble argument but backed with ample evidence

The National Company Law Appellate Tribunal (NCLAT), New Delhi bench comprising Judicial Member Justice Anant Bijay Singh and Technical Member Ms. Shreesha Merla was hearing an appeal wherein the Bench observed that the dispute raised by the Corporate Debtor was not a spurious or legally feeble argument but was substantiated by sufficient evidence.

In the instant case, the Appellant was aggrieved by the Order passed by the Learned Adjudicating Authority (National Company Law Tribunal, Ahmedabad Bench) wherein the Adjudicating Authority had dismissed the Application filed by the Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Operational Creditor preferred this Appeal.

The Bech noted, "When there is no denial with respect to the email dated 22.02.2018 (reproduced in para 7) there are no substantial reasons given for raising the bills for the subsequent period when there is no documentary evidence on record that the services were rendered with respect to the Work Order subsequent to 22.02.2018."

The Appellate Authority was satisfied by the material on record that there was a ‘Pre-Existing Dispute’ prior to the issuance of the Demand Notice and hence the Appellate Authority were of the considered view that the ratio of Mobilox Innovations Private Limited, REED 2017 SC 09545 was squarely applicable to the facts of this case.

As the Appellate Tribunal held that there was an existence of a dispute between the parties, Court did not wish to go into the other issues raised regarding the Partnership Deed. For all the aforenoted reasons, the Appeal failed.

View Judgment

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