In Brief
This case concerns the triggering of insolvency proceedings by an operational creditor under the Insolvency and Bankruptcy Code, 2016. Mobilox had hired Star TV to conduct televoting for a show and subcontracted to Kirusa for telephone number services. After Kirusa displayed confidential information on its website, Mobilox withheld payment claiming breach of their Non-Disclosure Agreement. Kirusa sought insolvency proceedings claiming unpaid invoices. The Tribunal dismissed the application, holding the dispute was invalid. The Supreme Court held that a genuine dispute exists in fact when there is a plausible contention requiring investigation that is not patently frivolous. The Court found Mobilox raised a legitimate dispute regarding the NDA breach, even though it was not pending in a suit or arbitration. The appeal was allowed, and the case was remitted for fresh consideration.
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