The National Company Law Tribunal (NCLT) at Mumbai has recently dismissed Manlift India Private Limited's insolvency petition against Shapoorji Pallonji and Company Private Limited.
It found that the undisputed operational debt fell below the ₹1 crore threshold under the Insolvency and Bankruptcy Code (IBC).
The tribunal excluded 41 invoices raised in the name of a joint venture and 17 time-barred invoices. It also excluded nine invoices involving a plausible dispute requiring reconciliation. It held that the remaining undisputed principal debt did not meet the statutory threshold.
A Bench of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar held that Manlift India had failed to establish an undisputed operational debt meeting the threshold under the Insolvency and Bankruptcy Code.
"In view of the foregoing discussion, we find that, after excluding the invoices raised in the name of the Joint Venture, the invoices barred by limitation, and the amounts in respect of which a plausible dispute requiring reconciliation has been raised, the undisputed principal operational debt does not meet the minimum threshold of Rs. 1 Crore prescribed under Section 4 of the Code. Even if the payments made by the Corporate Debtor subsequent to the filing of the present Petition are ignored, the undisputed amount, after the aforesaid exclusions, remains below the statutory threshold."
Manlift India filed the petition on December 5, 2024 seeking recovery of ₹5.53 crore, including principal dues of ₹3.83 crore and interest of ₹1.70 crore, for equipment and services provided across various Shapoorji Pallonji projects.
It had issued a demand notice on September 17, 2024. Shapoorji Pallonji disputed the claim, contending that several invoices belonged to a joint venture, certain claims were time barred and payments had already been made.
The Tribunal first excluded 41 invoices worth ₹88.83 lakh raised in the name of the Shapoorji Pallonji-Shapoorji Pallonji Qatar joint venture, holding that the Corporate Debtor could not be made liable for invoices issued to a separate entity. After adjusting a payment of ₹6 lakh, the principal outstanding stood at ₹1.33 crore.
The Tribunal then excluded 17 invoices aggregating ₹30.22 lakh, holding that they were time-barred. The subsequent payment of ₹6 lakh could not extend limitation under Section 18 of the Limitation Act because it was made after the limitation period had expired.
The Tribunal also found a plausible dispute requiring reconciliation concerning nine invoices worth ₹13.26 lakh. Emails between the parties indicated that their accounts remained unreconciled, while payments had been made against invoices relating to Bengaluru, Pragati Maidan and Guwahati projects.
Accordingly, the bench held that the undisputed principal debt fell below ₹1 crore and dismissed Manlift India's insolvency petition as not maintainable.
For the Operational Creditor: Advocates Gaurav Suryavanshi a/w Anushka Bhosale
For the Corporate Debtor: Advocates Ahmed Padela a/w Giripriya Pai i/b Law Point