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2018 (10) TMI 1747 - Tri - Insolvency and BankruptcyMaintainability of petition - initiation of CIRP - Corporate Debtor has defaulted in making repayment of debt - existence of debt - HELD THAT - For the Petitioner having proved the existence of debt as well as existence of default, this Petition is hereby admitted against this Corporate Debtor. The Corporate Debtor having named the Interim Resolution Professional with his consent, there being no disciplinary proceedings against the same, this Bench hereby admits this petition filed under Section 7 of IBC, 2016, declaring moratorium with consequential directions - petition admitted - moratorium declared.
Issues:
1. Jurisdiction of the Tribunal 2. Validity of the assignment agreement 3. Timeliness of the petition 4. Existence of debt and default Jurisdiction of the Tribunal: The petition was filed under section 7 of the Insolvency & Bankruptcy Code, 2016 by the Asset Reconstruction Company (India) Limited (ARCIL) against the Corporate Debtor for defaulting on a debt. The Respondent challenged the jurisdiction of the Bench, arguing that the petition should be heard by a specific Bench and that the Petitioner did not have the authority to file the petition as it was signed by a representative of ARCIL Company, not ARCIL Trust. The Respondent also cited a previous order by DRT-I regarding the validity of the assignment deed. Validity of the Assignment Agreement: The Respondent contested the validity of the assignment agreement, alleging that it was executed fraudulently and without proper authorization. The Respondent claimed that the assignment was time-barred and that the Petitioner failed to provide necessary documentation to support the validity of the agreement. However, the Tribunal found that the assignment agreement legally assigned the debt to ARCIL Company, making it a financial creditor as per the IBC, 2016. Timeliness of the Petition: The Respondent argued that the petition was time-barred as it was filed beyond the limitation period of three years from when the account was classified as a Non-Performing Asset (NPA). The Tribunal rejected this argument, citing the limitation period for suits enforcing payment of money secured by a mortgage. Existence of Debt and Default: The Tribunal noted that the debt to the original lender, SBI, was undisputed, and the default in repayment was admitted by the Respondent. Despite the Respondent's objections to the assignment agreement, the Tribunal found clear evidence of debt and default, meeting the criteria under the IBC, 2016. The Tribunal admitted the petition against the Corporate Debtor and appointed an Interim Resolution Professional to oversee the insolvency resolution process. In conclusion, the Tribunal upheld the validity of the assignment agreement, dismissed the jurisdictional challenges, rejected the timeliness argument, and admitted the petition based on the existence of debt and default, declaring a moratorium and appointing an Interim Resolution Professional for further proceedings.
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