Siddharth Nahata Vs. Billets Elektro Werke Pvt. Ltd [Company Appeal (AT) (Insolvency) No. 199 of 2017] - Synopsis
Team SoOLEGAL 2 Mar 2021
In this case, Siddharth Nahata Vs. Billets Elektro Werke Pvt. Ltd [Company Appeal (AT) (Insolvency) No. 199 of 2017], the respondent had argued that he was an Operational Creditor and launched the insolvency proceedings against the appellant (original respondent) Corporate Debtor on the basis of default. The respondent had sent a notice under Section 8 of Insolvency Bankruptcy Code, 2016, on 22nd May 2017, and the appellant on 7th June, 2017, had responded, by raising a dispute. Reference was made to an earlier exchange of correspondence dated 20th July, 2016 and 3rd August 2017 and to a criminal complaint lodged by the appellant that the balance was not yet due for the reasons specified. When the case had appeared before the learned National Company Law Tribunal, the parties on both sides were considered, but the learned NCLT did not think the dispute posed by the appellant appropriate and was of the view that it was illusory and without legs to stand.

When the case was brought before the National Company Law Appellate Tribunal, both the learned counsel for the appellant and the respondent submitted that the matter had been compromised between the Operational Creditor and the Corporate Debtor and that the required payments had been made and that consideration had been taken with regard to the payments of the Insolvency Resolution Professional. The Appellant's counsel claimed that there was no other creditor. According to the Bench, a Compromise that has taken place would not be material for the decision of this appeal, once the process has been set into motion. The Court had to consider this appeal on its own merits In the arguments of the learned counsel for the Appellant, the Bench had found that there was still a previous dispute and that the application under Section 9 could not have been approved. In view of the above, the appeal was allowed. The order which granted the Insolvency Resolution Process was quashed and set aside. 

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