An insolvency petition was filed under the Insolvency and Bankruptcy Code (IBC), 2016 with the intent to pressure the company for payment despite the existence of a prior dispute. The key issue was whether the petition was based on a genuine default or was a fraudulent attempt to coerce recovery. Under Section 65 of the IBC, malicious or fraudulent initiation of insolvency proceedings is prohibited and may attract penalties ranging from ₹1 lakh to ₹1 crore. It was established that there was a clear pre-existing dispute and no valid proof of default, indicating misuse of the IBC as a recovery mechanism. The NCLT dismissed the petition, recognizing the dispute and treating the filing as an abuse of process. This case reinforces that the IBC cannot be used for recovery of disputed dues or as a tool for harassment.