The National Company Law Tribunal (NCLT) in Bengaluru on October 22 dismissed an insolvency plea filed against tech giant Wipro by a California-based cloud service provider called Ivalua Inc.

A coram of Judicial Member K Biswal and Technical Member Manoj Kumar Dubey heard and dismissed the plea.

Wipro was represented by a team from Cyril Amarchand Mangaldas comprising Partner Lomesh Kiran Nidumduri and Senior Associates Prashasthi Bhat and Abhijna S.

Ivalua was represented by Kochhar & Co's Partner Meena Venugopal.

Ivalua had filed a petition under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016 alleging that Wipro had failed to pay $3,00,000 (₹ 2.8 crore) for the cloud services that it had rendered.

It contended that under a service agreement dated July 28, 2021, the company had issued three invoices to Wipro, each exceeding $100,000. Ivalua also argued that that Wipro did not respond to the demand notice within the required seven-day timeframe as per the IBC.

Wipro had argued that it was not under any obligation to settle the invoices, as the services provided did not extend beyond the proof-of-concept stage. This stage serves as a testing period for the recipient to evaluate the service before fully adopting.

Wipro's counsel informed the Tribunal that the company had already made payments for the proof of concept, and since no services were rendered beyond this stage, the invoices need not be honoured. In this light, Ivalua would not qualify to be an operational creditor, Wipro contended.

The NCLT accepted Wipro's contention and dismissed the plea today.