Bay Forge v. Nawa Engineers & Consultants
CP (IB) 198/09/HDB/2017
In the National Company Law Tribunal ay Hyderabad
Before Mr RR Vittanala, Member (Judicial) and Mr R Duraisamy, Member (Technical)
Decided on January 22, 2018
Relevancy of the case: Consideration of excel sheets as primary evidence and applicability of Section 65B in insolvency proceedings
Statutes & Provisions Involved:
- The Information Technology Act, 2000 (Section 2(1)(o))
- The Indian Evidence Act, 1872 (Section 63, Section 65A, Section 65B)
Relevant Facts of the Case:
- Petitioner is aggrieved due to the non-payment of dues by the respondent. The amount due, as operational debt, is ₹ 46,02,625/- due on 24.01.2013. Further, an amount of ₹ 35,01,367/- was due as interest at a rate of 24% per annum from the due date and the first date of default was 30.03.2013.
- The amount due was for the purchase order that the respondent made for forged proof machine shafts.
- The respondent had agreed to make 100% payment to petitioner by issuing an irrevocable letter of credit of a nationalised bank payable at 60 days from the date of dispatch.
- The letter of credit was to be established immediately on receipt of inspection reports/readiness of the material along with the proforma invoice.
- The respondent on 30.03.2013 sent an email to plaintiff asking them to make the payment directly from them instead of from the line of credit.
- The plaintiff in good faith accepted the request of the defendant.
- The defendant has through emails dated 25.10.2013, 22.04.2014 and 17.02.2016 admitted their default on non-payment of outstanding dues.
Opinion of the Bench:
The court is convinced that a situation exists where the petition filed is in accordance with Section 9 of the Insolvency and Bankruptcy Code. The court is also convinced that the debt and default are proved.
- The court allowed for recovery of property by owner or lessor where such property is held by the corporate debtor.
- The defence taken up under Section 65B of the Indian Evidence Act, 1872 to prove that the excel sheet is not a form of primary digital evidence was rejected.
- The court ordered to follow all provisions of the IBC as the insolvency proceedings were to begin.
- The IRP should give a chance to the defendants to be heard so that the principle of natural justice audi alter partum can be followed.