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The Tax Publishers 2018 TaxPub(CL) 0011 (NCLAT-Del)
Billets Elektro Werke (P.) Ltd. v. Tryst Industries (P.) Ltd.
INSOLVENCY AND BANKRUPTCY CODE, 2016, --Initiation of corporate insolvency resolution process by operational creditor --Non-payment of outstanding dues No dealership agreement --Existence of debt and default--Where corporate debtor raised objection that operational creditor directly sold goods within its territory despite the dealership agreement between them but there was no documentary evidence to substantiate the same, therefore, operational creditor was entitled for initiation of CIRP.--BEWPL (operational creditor) filed petition for initiation of CIRP against TIPL (corporate debtor) on the ground of non-payment of its dues. TIPL disputed the said liability on the ground that BEWPL directly sold goods within its territory despite the dealership agreement between them, thereby, affected its business and was directly responsible for its financial losses. Therefore, CIRP could not be triggered against it. Held: There was no documentary evidence to substantiate that a dealership agreement existed between the parties. Further, e-mails on record acknowledged the liability to pay, as TIPL expressed its financial difficulty in liquidating the same. Further that, the issuance of 'C' forms, part payment by way of acknowledgement of the outstanding liability as well as specific confirmation of the outstanding liability was clear admission of a debt due by TIPL to BEWPL. Therefore, BEWPL was entitled for initiation of the resolution process.
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