2019 (8) TMI 1458 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt or not - HELD THAT - The provisions of Section 7 (2) and Section 7 (5) of IBC have been complied as discussed in ECL FINANCE LIMITED VERSUS DIGAMBER BUILDCON PVT LTD 2018 (11) TMI 1741 - NATIONAL COMPANY LAW TRIBUNAL, NEW DELHI. . A default has occurred and the application under sub section 2 of Section 7 is complete. The name of the IRP has been proposed and there are no disciplinary proceedings pending against the proposed Interim Resolution Professional - petition admitted - moratorium declared.

Summary

Issues involved:
- Application under Section 7 of the Insolvency and Bankruptcy Code, 2016 for Corporate Insolvency Resolution Process.
- Default in possession delivery and payment obligations by the Corporate Debtor.
- Objections raised by the Corporate Debtor regarding default and possession.
- Compliance with Section 7(2) and Section 7(5) of IBC.
- Appointment of Interim Resolution Professional.
- Declaration of moratorium under Section 14 of the Code.
- Direction for deposit by Financial Creditor with the Interim Resolution Professional.
- Requirement for ex-management to provide documents and information.
- Complaints against financial creditors regarding claimed amounts.

Detailed Analysis:

1. The Petitioner, a financial creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking Corporate Insolvency Resolution Process against the Corporate Debtor, a real estate developer.

2. The Petitioners claimed default in payments by the Corporate Debtor related to a real estate project where apartments were booked, and payments were made as per agreements and receipts provided.

3. The Corporate Debtor objected to the petition, citing delays due to infrastructure provisioning by authorities, which led to non-delivery of possession within the stipulated time frame.

4. The Tribunal rejected the objections raised by the Corporate Debtor, emphasizing that the possession was due and payable after the stipulated period, as per the agreement terms.

5. The Tribunal found that all requirements of Section 7 of the Code were fulfilled, leading to the admission of the petition and the appointment of an Interim Resolution Professional.

6. A moratorium was declared under Section 14 of the Code, with exceptions for certain transactions and essential supplies to the Corporate Debtor.

7. The Financial Creditor was directed to deposit a sum with the Interim Resolution Professional to cover expenses, subject to adjustment by the Committee of Creditors.

8. Directions were issued for the ex-management to provide necessary documents and information to the Interim Resolution Professional promptly.

9. The Tribunal addressed complaints against financial creditors regarding claimed amounts, urging Resolution Professionals to rectify any discrepancies to prevent injustice to the corporate debtors.

10. Various procedural directions were given, including communication of the order to involved parties, provision of documents to the IRP, and updating of records with the ROC.

This detailed analysis covers the key issues and outcomes of the Tribunal's judgment regarding the initiation of Corporate Insolvency Resolution Process and related matters.