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2019 (9) TMI 1439 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT - On perusal of the documents submitted by the financial creditor, it is clear that debt amounting to ₹ 1,88,07,500/- is due and payable by the Corporate Debtor to the Applicant. The debt is admitted by the Corporate Debtor in its Account Confirmation dated 20.07.2016 for the period 01.04.2015 to 31.03.2016 reflecting an outstanding amount of ₹ 1,50,00,000/- against the name of the Applicant as well as recording the entries for interest paid and TDS payable on the interest paid. As per the terms of the Hundies dated 19.12.2013 and 07.10.2010 it was agreed between the parties that the loan shall be repaid on Demand. The Applicant demanded repayment of the entire amount of ₹ 1,88,07,500/- including interest payable by the Corporate Debtor on or before 08.06.2019 vide its notice dated 04.06.2019. The said amount of ₹ 1,88,07,500/- is admittedly not repaid. The outstanding amount that is admittedly in default is more than ₹ 1,00,000/-. The application filed by the financial creditor is on proper form 1, as prescribed under the Adjudicating Authority Rules and application is complete - application admitted - moratorium declared.
Issues Involved:
Application under section 7 of Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process (CIRP) against a Corporate Debtor. Detailed Analysis: 1. Admission of Application (Para 1-3): The application CP 2242/2019 was filed by a Financial Creditor against the Corporate Debtor under section 7 of the Insolvency & Bankruptcy Code. The application was admitted by the Tribunal on 19.09.2019. The Director of the Applicant was duly authorized to file the application. 2. Debt and Default (Para 4-6): The Applicant extended an unsecured loan to the Corporate Debtor, which was repayable on demand with interest. The Applicant claimed an amount due and outstanding, supported by documents like cheques, bank certificates, and ledger entries showing default in payment of interest by the Corporate Debtor. 3. Dispute and Default (Para 11): The Corporate Debtor raised objections citing pre-existing disputes and instructions to stop paying interest. However, the Tribunal found no valid dispute as the debt and default were established by the Applicant's documents. Citing a Supreme Court decision, the Tribunal held that even disputed debt falls under section 7 of the I&B Code. 4. Admission of Application (Para 12-15): The Tribunal confirmed the due and payable debt by the Corporate Debtor to the Applicant. The application filed by the Financial Creditor was found to be in proper form and complete. The proposed Interim Resolution Professional was also approved, and the application for initiation of CIRP was deemed admissible. 5. Order and Moratorium (Para 16): The Tribunal admitted the petition under Section 7 of the I&B Code, initiating the Corporate Insolvency Resolution Process against the Corporate Debtor. A moratorium was declared under section 14 of the I&B Code, prohibiting various actions against the Corporate Debtor. An Interim Resolution Professional was appointed to oversee the resolution process. This detailed analysis covers the key aspects of the Tribunal's judgment regarding the application for initiating CIRP against the Corporate Debtor under the Insolvency & Bankruptcy Code, 2016.
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