2019 (7) TMI 1732 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of default or not - Dishonor of Cheque - non-compliance with the terms of the amicable settlement - post dated cheques issued against the payment of the claim made by the petitioner - HELD THAT - The default stands established and there is no reason to deny the admission of the petition. It is needless to say that if any payment has been made that will be looked into by the Resolution Professional. CS Mr. Vekas Kumar Garg, having registration no. IBBI/IPA-002/1P-N00738/2018-2019/ 12291with the Address - D-4 B, First Floor Ramprastha, Near Raghunath Temple, Ghaziabad (Uttar Pradesh) -201011, is appointed as IRP who has filed his declaration in accordance with Rule 9 of Adjudicating Authority Rules and he is to act as an IRP by performing all his duties. Te provisions of Section 7 (2) and Section 7 (5) of IBC have been complied the requirements of Section 7 of the Code for initiation of Corporate Insolvency Resolution Process stand fulfilled and accordingly the present petition is admitted - petition admitted - moratorium declared.

Summary

Issues:
1. Non-compliance with terms of amicable settlement leading to revival of the petition.
2. Dishonored post-dated cheques and revival of proceedings.
3. Compliance with Section 7 and Section 14 of the Insolvency and Bankruptcy Code.
4. Appointment of Interim Resolution Professional and declaration of moratorium.
5. Direction for public announcement and deposit by Financial Creditor.
6. Obligation of ex-management to provide documents and information.
7. Addressing complaints against financial creditors regarding claims.

Issue 1: Non-compliance with terms of amicable settlement leading to revival of the petition
The application for revival of the petition was filed due to the non-compliance with the terms of the amicable settlement, specifically regarding dishonored post-dated cheques issued against the payment claim made by the petitioner. The petitioner sought revival of the petition due to this non-compliance.

Issue 2: Dishonored post-dated cheques and revival of proceedings
The post-dated cheques issued were dishonored, establishing the default and acknowledging the amount sought to be paid. The Tribunal revived the proceedings in CP. No. (IB)281 (PB)/2019 based on this default, appointing an Interim Resolution Professional to act in accordance with the insolvency proceedings.

Issue 3: Compliance with Section 7 and Section 14 of the Insolvency and Bankruptcy Code
The Tribunal found compliance with Section 7 (2) and Section 7 (5) of the Insolvency and Bankruptcy Code, as discussed in a previous order, leading to the admission of the present petition. Additionally, a moratorium was declared in accordance with Section 14 of the Code.

Issue 4: Appointment of Interim Resolution Professional and declaration of moratorium
An Interim Resolution Professional was appointed to handle the insolvency proceedings, with directions for a public announcement and a deposit of funds by the Financial Creditor to meet expenses. The Tribunal declared a moratorium, specifying exceptions for certain transactions and supplies of essential goods or services.

Issue 5: Direction for public announcement and deposit by Financial Creditor
The Financial Creditor was directed to deposit a specified sum with the Interim Resolution Professional to cover expenses and perform assigned functions. Additionally, the ex-management was obligated to provide all necessary documents and information within a week from the admission of the petition.

Issue 6: Obligation of ex-management to provide documents and information
The ex-management was directed to provide all documents and furnish necessary information to the Interim Resolution Professional within a stipulated timeframe, failing which coercive steps would be taken as per Section 19 of the Code.

Issue 7: Addressing complaints against financial creditors regarding claims
The Tribunal acknowledged complaints against financial creditors regarding alleged inflated claims and exorbitant interest rates. It emphasized the role of Resolution Professionals in addressing such issues to prevent injustice to the corporate debtor. The office was directed to communicate the order to relevant parties promptly for compliance and updating of records.