# In the matter of Jeyyam Global Foods Private Limited IBA-66-2020

> NCLT judgment dated 2021-09-02. Citation: TCN-2021-NCLT-01216. Maximus People Solutions Private Limited, the Operational Creditor, filed an application under…

- **Court:** NCLT
- **Order date:** 2 Sept 2021
- **Citation:** TCN-2021-NCLT-01216
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/jeyyam-global-foods-private-limited-iba-66-2020-32915b81

## Summary

### Background

Maximus People Solutions Private Limited, the Operational Creditor, filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Jeyyam Global Foods Private Limited, the Corporate Debtor. The Operational Creditor claimed that the Corporate Debtor defaulted on a payment of Rs. 52 lakh for management consulting services provided between 2015 and 2018. The Corporate Debtor argued that there was a pre-existing dispute regarding the services and the amount due, and that the Memorandum of Understanding (MOU) entered into between the parties was void due to the resignation of Mr. A. Krishnan, the Managing Director of the Operational Creditor.

## Facts

Maximus People Solutions Private Limited (Operational Creditor) provided management consulting services to Jeyyam Global Foods Private Limited (Corporate Debtor) from 2015 to 2018. A Memorandum of Understanding (MOU) was executed on February 21, 2018, acknowledging a debt of Rs. 52 lakh owed by the Corporate Debtor to the Operational Creditor. The Operational Creditor issued a demand notice on October 24, 2019, and another on November 16, 2019, after the Corporate Debtor allegedly failed to make the payment. The Corporate Debtor claimed that the services were not satisfactory, that there was no written agreement for the period 2016-2017, and that Mr. A. Krishnan, the Managing Director of the Operational Creditor, had resigned, rendering the MOU void. The Corporate

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## Issues and analysis

### Issue 1: Whether there has been any dispute arisen between the parties before issuance of the Demand Notice …

**Ratio:** The existence of a pre-existing dispute is a valid ground for rejecting an application

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**Reasoning:** The Adjudicating Authority relied on the reply sent by the Corporate Debtor on January

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**Interpretation:** The court interpreted the evidence to determine whether a genuine dispute

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**Application:** The court applied the principle that a pre-existing dispute bars the initiation

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## Parties

- **Judges:** R. Sucha…; Anil Ku…
- **Appellants:** Maximus People…
- **Respondents:** Jeyyam Global…
- **Advocates:** R. Ra…; S. Yogala…

## Timeline

- **2015-04-01 — Consulting Services…**: Maximus People Solutions Private Limited began providing management consulting services…
- **2018-02-21 — MOU Exec…**: A Memorandum of Understanding (MOU) was executed between the parties, acknowledging a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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