2018 (12) TMI 1713 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to repay to debt - HELD THAT - An 'Operational Debt' is owed by the Corporate Debtor to the Operational Creditor in view of services rendered by it and a default has been committed by the Corporate Debtor in relation to the payment of Operational Debt without any plausible contention being put forth and the contentions sought to be raised it is seen as only sham or illusory. The Tribunal is inclined to admit this application and accordingly initiate the process of CIRP of the Respondent - Application admitted - moratorium declared.

Summary

Issues Involved:
a) Whether the services are being provided to Global Energy Talent Private Limited, Gurgaon or Global Energy Talent, Mauritius?
b) Whether the Operational Creditor will be paid fully for all the sessions for 42 days?
c) Whether there is any pre-condition that payments would be made to the Operational Creditor only upon clearance by Petro China?

Detailed Analysis:

Issue a: Whether the services are being provided to Global Energy Talent Private Limited, Gurgaon or Global Energy Talent, Mauritius?
The Tribunal observed that according to the Corporate and Business Registration Department (CBRD) Portal of the Mauritius Government, there exists no company registered by the name Global Energy Talent in Mauritius. Relevant extracts from the records of the Mauritian Government were attached as evidence. It was noted that all work-related statements and emails were exchanged between Mr. Vikram Singha and Dr. Mashaa'l, without any mention of contacting the wrong company. This indicated that the contract was with Global Energy Talent, Gurgaon, not Mauritius. Additionally, all training session sheets had the imprint of Global Energy Talent, Gurgaon.

Issue b: Whether the Operational Creditor will be paid fully for all the sessions for 42 days?
It was evident from the records that the Operational Creditor conducted 36 out of the 42 contracted training sessions. Therefore, the Operational Creditor would only be paid for the 36 training days conducted. The Operational Creditor had sent a fresh invoice for these days to Mr. Vikram Singha.

Issue c: Whether there is any pre-condition that payments would be made to the Operational Creditor only upon clearance by Petro China?
The Tribunal found that there was no condition in the contract stipulating that the Corporate Debtor would clear the amount only upon clearance by Petro China. Even if such a condition existed, it was clarified by Petro China, upon the Operational Creditor's request, that all payments had been made to Global Energy Talent, Gurgaon. This confirmed that the Corporate Debtor owed an 'Operational Debt' to the Operational Creditor for the services rendered, and the default in payment was without any plausible contention.

Conclusion:
The Tribunal admitted the application and initiated the Corporate Insolvency Resolution Process (CIRP) against the Respondent. Since the Applicant did not name an insolvency resolution professional, the Tribunal appointed Mr. Mohinder Singh as the Interim Resolution Professional (IRP), subject to conditions. As a consequence, the moratorium as envisaged under Section 14(1) of the Insolvency and Bankruptcy Code, 2016, came into effect, prohibiting certain actions against the Respondent.

The moratorium would last until the completion of the corporate insolvency resolution process, or until the Tribunal approved a resolution plan or ordered liquidation. The Applicant was directed to pay a sum to the IRP for expenses. The application was admitted under Section 9(5) of the Insolvency and Bankruptcy Code, 2016, and the moratorium came into effect from the date of the order. Copies of the order were to be communicated to the Applicant, Respondent, and the Insolvency and Bankruptcy Board of India (IBBI).