The National Company Law Appellate Tribunal has observed the correspondence and dispute regarding the issuance of Non-Objection Certificates before the issuance of notice under Section 8 of the Insolvency and Bankruptcy Code,2016 and thus, qualifying to be treated as a “pre-existing dispute”, which is a valid ground for rejection of the application under Section 9 of the IBC.
This appeal has been filed by Law & Kenneth Saatchi & Saatchi Private Limited against the order passed by the National Company Law Tribunal, Allahabad, wherein the application of the Appellant under Section 9 of the IBC was dismissed.
The Appellate Tribunal observed that the various emails exchanged, as well as the letters from the legal department of the Corporate Debtor and the response by the legal representative of the Operational Creditor, are evidence that there was a genuine and real dispute regarding the issue of NOC by the Operational Creditor regarding TVC.
These emails and letters were prior to the issue of notice under Section 8 of the IBC, 2016.
The Appellate Tribunal relied on the judicial precedents which have held that the adjudicating authority is required to examine whether there is a valid and genuine dispute prior to the issuance of a demand notice.
The judgment was pronounced by Justice Yogesh Khanna (Judicial Member), and Ajai Das Mehrotra (Technical Member).
