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2019 (8) TMI 69 - AT - Insolvency and BankruptcyAdmissibility of petition - Initiation of Corporate Insolvency Resolution Process - Corporate Debtor - Section 7 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - As per the Financial Creditor the account of the Corporate Debtor was declared as Non-Performing Asset (NPA) with effect from 1st December, 2015. The Corporate Debtor having defaulted, the Financial Creditor issued notice under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI) on 24th April, 2017. Inspite of that payment having not made, action was taken under Section 13(4) of the SARFAESI Act, 2002 on 27th July, 2017. The Appellant has not disputed that the Corporate Debtor defaulted in paying the debt (loan amount). The only ground is taken is about the dispute relating to quantum of payment - even if the loan amount is disputed as we find that the amount is more than Rupees One Lakh (in present case more than ₹ 75 Crore), we hold that the application under Section 7 was rightly admitted by the Adjudicating Authority. Appeal dismissed.
Issues:
1. Condonation of delay in filing appeal 2. Dispute regarding debt amount and initiation of Corporate Insolvency Resolution Process 3. Validity of application under Section 7 of the Insolvency and Bankruptcy Code, 2016 Analysis: 1. The judgment addressed the issue of condonation of delay in filing the appeal. The Appellate Tribunal, after hearing both parties, was satisfied with the grounds presented and thus condoned the delay of six days in preferring the appeal. Consequently, I. A. No. 1837 of 2019 was disposed of. 2. The appeal was filed by the Director of a company against the order initiating Corporate Insolvency Resolution Process against the company. The appellant argued that there was a dispute about the debt amount and that the Adjudicating Authority failed to consider certain aspects regarding the credit facility reduction and restructuring. However, the Tribunal noted that the account of the Corporate Debtor was declared a Non-Performing Asset (NPA) and various actions were taken due to default on payments. The Tribunal referred to the "Innoventive Industries Ltd. Vs. ICICI Bank" case, highlighting the broad definition of default under the Insolvency and Bankruptcy Code. Despite the dispute over the quantum of payment, the Tribunal upheld the admission of the application under Section 7 as the debt amount exceeded the threshold. 3. The Tribunal also addressed the validity of the application filed under Section 7 of the Insolvency and Bankruptcy Code. It noted that the application was filed by an officer of the bank, dismissing the appellant's argument that it was not filed by an authorized person. The Tribunal found no merit in the appellant's grounds and subsequently dismissed the appeal without costs.
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