IBC Laws - NCLT imposes cost on Operational Creditor on inflating the rate of interest to bring Operational Debt under the threshold limit envisaged under section 4 of IBC - Sun Printers v. OMICS International Pvt. Ltd.

(2023) ibclaw.in 1059 NCLT

IN THE NATIONAL COMPANY LAW TRIBUNAL
Hyderabad Bench

Sun Printers
v.
OMICS International Pvt. Ltd.

CP (IB) No. 271/9/HDB/2022
Decided on 21-Dec-23

Coram: Shri Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri Charan Singh (Technical Member)

Add. Info:

Corporate Debtor: OMICS International Pvt. Ltd.

For Appellant(s): Ms. Kritika Sharma, PCS along Mrs. A.Sandhya Rani, Counsel

For Respondent(s): Mr. P.Ravi Prasad, Counsel

Brief about the decision:

Facts of the case

This Application is filed by M/s. Sun Printers (Operational Creditor) under Section 9 of IBC for initiation of CIRP against Omics International Pvt. Ltd. (Corporate Debtor) alleging that the following amount is due and payable to the Petitioner/Operational Creditor as on 08.02.2022:

• Principal amount: 68,96,128/-
• Interest amount (@24%): 36,41,582/-
• Total: 1,05,37,712/-
• Total amount claimed: 1,05,37,712/-.

However, the Corporate Debtor received a legal notice dated 04.09.2021 from the Petitioner claiming an amount of Rs. 59,40,549/- along with interest and future interest @18% per annum.

Decision of the Adjudicating authority

The claim of operational debt of a sum of Rs. 1,05,37,712/-, includes the sum of Rs.36,41,582/- being the interest on the said sum @24% per annum from the due date, hence dehors interest at 24% or even calculating @18% p.a. the present application will not meet the threshold limit of Rs One Crore as entitled under Section 9 of I&B Code, hence will be liable to be dismissed as not maintainable.(p15)
Strangely, the petition is completely silent on the “basis”, for claiming interest @24% p.a. on the principal sum of Rs 68,96,128/- . The invoices relied on by the petitioner are also silent on payment of any interest on the said sum. Only after the respondent vehemently disputed the debt as well as the claim of interest and also filed a copy of the legal notice dated 04.09.2021, the petitioner chose to file the so called quotation through a rejoinder and raised a contention for the first time that the quotation purportedly submitted by the respondent since contained the clause for payment of interest 24%. the respondent is bound to pay the same.(p16)
It is pertinent to note that the suppression of the fact of issuance of a legal notice dated 04.09.2021 by the petitioner to the respondent, whereunder the petitioner claimed an amount of Rs.59,40,549/- along with interest @18% by specifically stating that interest at 18% has been claimed ‘as is generally and customarily prevailing in the trade usages, is intentional, since the knowledge of issuance of legal notice dated 04.09.2021 is not denied.(p17)
That apart, the interest at 18% as claimed in terms of the afore stated legal notice on the purported operational debt of Rupees 68,96,128/- , even if is accepted as payable, yet the subject operational debt will not come under the pecuniary jurisdiction of this Tribunal.(p18)
Hence, it is clear that the sole purpose behind inflating the rate of interest to 24% p.a. is to bring the subject operational debt under the threshold limit envisaged under section 4 of IB Code and not because of any agreed clause or agreement between the parties. Hon’ble Supreme Court of India, in re Ramjas Foundation & Ors. Supra, wherein it was held that;

“The principle that a person who does not come to the Court with clean hands is not entitled to be heard on the merits of his grievance and, in any case, such person is not entitled to any relief is applicable not only to the petitions filed under Articles 32, 226 and 136 of the Constitution but also to the cases instituted in others courts and judicial forums”(Emphasis is ours).”

Therefore, we have no hesitation to come to the conclusion that the petitioner indulged in suppressing the material facts in its knowledge, hence we hereby in reject the interest claim as made by the petitioner. As already stated dehors the claim for interest @ 24% p.a. on the principal sum of Rs.68,96,128/-, the petitioner’s purported claim of existence of the operational debt allegedly due and defaulted, by the respondent will not attract section 9 of IB Code, as such the petition is liable to be dismissed as not maintainable before the Adjudicating Authority.(p20)
Here from the facts of this case it is clear that, the respondent has deliberately indulged not only in suppression of material fact of issuance of the legal notice dated 04.09.2021, which is well within its knowledge but also intentionally inflated the rate of interest with the sole purpose of bringing the purported claim under I&B Code, which is nothing but arm twisting the respondent to pay the claim as made.(p23)
Therefore, from the above provision it is clear that it is found by this Tribunal that initiation of Insolvency Resolution Process is with a malicious intent for any purpose other than the resolution of insolvency. This Tribunal may impose upon such person a penalty which shall not be less than one crore.
We have already held that the petitioner is indulged in suppression of material facts, which is with in its knowledge and also inflated the rate of interest, in order to bring subject claim under the purview of Section 9 of I&B Code. Therefore, we are of the view that the petitioner can be subjected to cost in this case. Hence, we direct the petitioner to pay sum of Rs.5 lakhs as costs payable to the Prime Minister reliefs fund through Bharat Kosh and file compliance within 15 days from the date of this order.
We hereby make it clear that we have not entered into any finding on the merits of the contentions as regards the existence of the operational debt as claimed by the petitioner.
In the result this Company Petition stands dismissed as not maintainable before this Adjudicating Authority, however with costs of Rs. 5,00,000/- payable to the Prime Minister reliefs fund through Bharat Kosh.