2018 (12) TMI 1813 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - HELD THAT - The corporate debtor in the instant case did not turn up to contest the petition. The applicant has produced all the required documents. The existence of default also stands proved. The applicant here, in this case, succeeds in proving that it has complied with all the requirements to be meted out under section 7(3) of the I B Code, 2016. Therefore, the application is liable to be allowed. Application admitted - moratorium declared.

Summary

Issues:
Application under section 7 of I&B Code for CIRP due to default in loan repayment by Corporate Debtor.

Detailed Analysis:
1. Default Allegation: The Financial Creditor filed an application under section 7 of the I&B Code against the Corporate Debtor, M/s. White & Brown Alloy Castings Pvt. Ltd., for defaulting in repaying a loan amount of ?13,65,97,120.31 as on 31-1-2018, including interest. The Corporate Debtor failed to make payments as per the repayment schedule, leading to the initiation of CIRP.

2. Documentary Evidence: The Financial Creditor provided various documents as proof, including ledger accounts, CIBIL extract, search report on charges, loan application, sanction letter, acknowledgment of debts, and demand notices under SARFAESI Act. These documents supported the claim of default and non-repayment by the Corporate Debtor.

3. Compliance with Requirements: The Financial Creditor demonstrated compliance with the necessary requirements under the I&B Code, such as classifying the account as NPA, issuing demand notices, and proving the existence of default through documentary evidence. The Corporate Debtor did not contest the petition, further strengthening the case for admission.

4. Admission and Moratorium: The Tribunal admitted the application, declared a moratorium, and ordered a public announcement in accordance with the IBC. The moratorium prohibits certain actions against the Corporate Debtor, and essential goods/services supply should not be interrupted during this period.

5. Appointment of Interim Resolution Professional: An Interim Resolution Professional was appointed to ascertain creditors' particulars, constitute a Committee of Creditors, and identify a Resolution Applicant within a specified timeframe. The Registry was directed to communicate the order to relevant parties, and a progress report filing was scheduled for a future date.

This detailed analysis outlines the key aspects of the judgment, including the default allegation, documentary evidence, compliance with legal requirements, admission of the application, moratorium declaration, and the appointment of an Interim Resolution Professional for further proceedings in the Corporate Insolvency Resolution Process.