DHL Supply Chain India Private Limited V. Eicher Motors Limited - Thus, in view of the above, we find no illegality or deficiency in the service of the Demand Notice, which has been duly served through the E-mail addressed to the Respondent with “Attention to its Managing Director”, who is a “Key Managerial Personnel” of the Respondent Company.

NCLT New Delhi-II (29.05.2023) In DHL Supply Chain India Private Limited V. Eicher Motors Limited [Company Petition No. (IB)-272(ND)2022] held that;

• Thus, in view of the above, we find no illegality or deficiency in the service of the Demand Notice, which has been duly served through the E-mail addressed to the Respondent with “Attention to its Managing Director”, who is a “Key Managerial Personnel” of the Respondent Company.

Excerpts of the order; 

# 8. We have heard the submission of the parties on 21.11.2022, 22.12.2022, and 01.02.2023 and perused the documents placed on the record including the written submissions filed by both parties. During the hearings on 21.11.2022, the Ld. Counsel appearing on behalf of the Applicant argued and reiterated almost all the points as stated in its application, written submission, and rejoinder. He stated that the Applicant has claimed an amount of Rs. 8.28 Crores, for which the Applicant had served the Demand Notice on the Respondent on 07.12.2021 at the email id mentioned in the master data of the Company. The Ld. Counsel appearing on behalf of the Respondent  contended that the present petition is not maintainable as the service of Section 8 Demand Notice was defective, three categories of claims have been bunched together and there were pre-existing disputes between the parties. Further, he argued that the Agreement dated 29.08.2019 was prematurely terminated in January 2021 and thereafter, no services were rendered by the Applicant to the Respondent. Therefore, all the invoices raised by the Applicant thereafter are not related to any services rendered by the Applicant.

9. The Respondent has argued that the Demand Notice issued by the Applicant is not in compliance with Rule 5 of Application to Adjudicating Authority Rules, 2016 as the Demand Notice is admittedly not served upon the Respondent at the registered office or by electronic mail service to a whole-time director or designated partner or key managerial personnel. Whereas the information/email-ids of its Directors are publicly available on the website of the Ministry of Corporate Affairs, the applicant had chosen to serve the demand notice via e-mail only at info@eicher.com which is not the email address of its whole-time director or key managerial personnel. 

9.1 Hence, before going into other aspects, we would like to examine Whether the service of Section 8 demand notice upon the Respondent was a valid one. From the record, it is observed that the Applicant had served the Section 8 Demand notice via email, which is reproduced below:

On perusal of the aforesaid email, it is seen that the Demand Notice was mailed to info@eichermotors.com with “Attention (to): The Managing Director”.

9.2 At this juncture, we refer to the Master Data of the Respondent Company, which reads thus:

On conjoint reading of the E-mail dated 07.12.2021 and the Master Data of the Respondent Company, it is seen that the Demand notice was sent to the official email id of the Respondent Company. Further, we notice that “Directors/Signatory Details” in the Master Data do not contain the e-mail ids of the individual Directors and on its perusal, one cannot determine who is the whole-time Director/Key Managerial Personnel of the Respondent, and moreover, a director may or may not be falling under the category of whole-time Director/KMP. 

9.3 At this juncture, we refer to Rule 5 of the Application to Adjudicating Authority Rules, 2016, which reads thus:

• “5. Demand notice by operational creditor. — (1) An operational creditor shall deliver to the corporate debtor, the following documents, namely -

• …..

• …..

• (2) The demand notice or the copy of the invoice demanding payment referred to in sub-section (2) of section 8 of the Code, may be delivered to the corporate debtor,

• (a) at the registered office by hand, registered post or speed post with acknowledgement due; or

• (b) by electronic mail service to a whole time director or designated partner or key managerial personnel, if any, of the corporate debtor.” (Emphasis supplied)

Thus, as per Rule 5(2)(b), an Operational Creditor shall deliver the Demand Notice to the Corporate Debtor -

• Either at the registered office by hand, registered post or speed post with acknowledgement due,

• Or by electronic mail service to a whole time director or designated partner or key managerial personnel, if any, of the corporate debtor.”

9.4 It is evident from the Master Data of the Respondent that the email ids of whole-time Directors and Key Managerial Personnel are not available in the public domain. However, the official email id of a Company is known to all. Further, Section 8 notice is a demand against the Corporate Debtor and not against its whole-time Director or Key Managerial Personnel, in their personal capacity. Even the Form 3 and Form 4 formats of issuing a Demand Notice do not stipulate that the Demand Notice shall be addressed to a whole-time Director or Key Managerial Personnel.

9.5 At this juncture, we refer to the Judgement of the Hon’ble Supreme Court dated 06.05.2015 passed, in the context of service of Demand Notice under Section 138 of Negotiable Instruments Act proceedings, in the matter of Kirshna Texport and Capital Markets Ltd. Vs Ila A. Agrawal and others in Criminal Appeal No.1220 of 2009, wherein the following was held:

• “14. Section 141 states that if the person committing an offence under Section 138 is a Company, every director of such Company who was in charge of and responsible to that Company for conduct of its business shall also be deemed to be guilty. The reason for creating vicarious liability is plainly that a juristic entity i.e. a Company would be run by living persons who are in charge of its affairs and who guide the actions of that Company and that if such juristic entity is guilty, those who were so responsible for its affairs and who guided actions of such juristic entity must be held responsible and ought to be proceeded against. Section 141 again does not lay down any requirement that in such eventuality the directors must individually be issued separate notices under Section 138. The persons who are in charge of the affairs of the Company and running its affairs must naturally be aware of the notice of demand under Section 138 of the Act issued to such Company. It is precisely for this reason that no notice is additionally contemplated to be given to such directors. The opportunity to the ‘drawer’ Company is considered good enough for those who are in charge of the affairs of such Company. If it is their case that the offence was committed without their knowledge or that they had exercised due diligence to prevent such commission, it would be a matter of defence to be considered at the appropriate stage in the trial and certainly not at the stage of notice under Section 138.”  (Emphasis supplied)

9.6 The ID mentioned in Master Data is the official id of the Corporate Debtor/Company and in terms of the judgment of the Apex Court (supra), the whole-time Directors or Key Managerial Personnel, who are in charge and running the affairs of the Company, are supposed to know what all is being received at the official/publicly notified email id of Company especially when “attention” is drawn to its Managing Director.

10. The Respondent has relied upon the Judgement of Hon’ble NCLAT dated 05.02.2021 in the matter of Jyoti Strips Pvt Ltd Jyoti Strips Pvt Ltd Vs Jsc Ispat Pvt Ltd, COMPANY APPEAL (AT) (Insolvency) No. 775 of 2020, wherein the following was held:

• “12. We have perused the 'Master Data' relied upon by the Appellant Counsel and also the subject email and note that there is no documentary evidence on record to establish that the email was sent as per the provisions mandated under Rule 5 of the Insolvency and Bankruptcy Rules, 2016. Hence, we concur with the findings given by the Learned Adjudicating Authority with respect to the fact that the Appellant herein had nowhere mentioned in the Application to whom the email was addressed to as it is clearly stipulated in Rule 5(1) of the Insolvency and Bankruptcy Rules 2016, that the notice shall be delivered by electronic mail service to a whole time Director or Designated Partner or Key Managerial Personnel, if any, of the Corporate Debtor. (Emphasis supplied) 

Per contra, in the instant case, as we have already noted that the email containing the demand notice was sent to the E-mail ID of the Respondent Company with “Attention to the Managing Director” of the Respondent, who is very well covered under the definition of a Key Managerial Personnel as defined under Section 2(51) of the Companies Act 2013, which reads thus -

• “2. Definitions — In this Act, unless the context otherwise requires-

• ----

• (51) “key managerial personnel”, in relation to a company, means –

• (i) the Chief Executive Officer or the managing director or the manager;

• (ii) the company secretary;

• (iii) the whole-time director;

• (iv) the Chief Financial Officer; and

• (v) such other officer as may be prescribed.”

Thus, in view of the above, we find no illegality or deficiency in the service of the Demand Notice, which has been duly served through the E-mail addressed to the Respondent with “Attention to its Managing Director”, who is a “Key Managerial Personnel” of the Respondent Company. Hence, we would like to proceed ahead in examining the application on its merits.

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