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2019 (11) TMI 1641 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT - It appeared from the records that the Corporate Debtor had sought several adjournments for settlement from 30.09.2019 to 28.11.2019. The Financial Creditors wanted CIRP to be initiated against the corporate debtor without further delay. As there is a default in the payment of the financial debt which has been agreed by the Corporate Debtor before this Bench the present application filed by the financial Creditor is satisfying all the definitions of Financial Creditor Default and Financial Debt and qualifies for filing an application under Insolvency and Bankruptcy Code. The application filed on behalf of Financial Creditor is complete - Application admitted - moratorium declared.
Issues:
1. Admission of application under Section 7 of the Insolvency and Bankruptcy Code. 2. Appointment of Interim Resolution Professional (IRP). 3. Implementation of Moratorium under Section 14 of the Code. 4. Continuation of essential services during the Moratorium period. 5. Public Announcement of the Initiation of Corporate Insolvency Resolution Process. 6. Duties of the Interim Resolution Professional under Sections 15 and 18 of the Code. 7. Effective date of Corporate Insolvency Resolution Process. Analysis: Admission of Application under Section 7: The Financial Creditor, a bank, filed an application against the Corporate Debtor for defaulting on a debt of over Rs. 14 crores. The Corporate Debtor had sought adjournments for settlement but failed to make payments. The Tribunal found the application satisfying the definitions of "Financial Creditor," "Default," and "Financial Debt," warranting admission under the Insolvency and Bankruptcy Code. Appointment of Interim Resolution Professional (IRP): The Financial Creditor recommended an Insolvency Professional for appointment as the IRP. The proposed IRP was duly registered with no pending disciplinary proceedings. The Tribunal appointed the recommended IRP to conduct the Insolvency Resolution Process. Implementation of Moratorium: Upon admission of the application, the Tribunal declared a Moratorium under Section 14 of the Code. This prohibited legal actions against the Corporate Debtor, including asset transfers, ensuring a stable environment for resolution proceedings. Continuation of Essential Services: While the Moratorium was in effect, essential services to the Corporate Debtor were to be maintained, ensuring the uninterrupted operation of critical services during the resolution process. Public Announcement and Duties of IRP: The IRP was tasked with making a public announcement of the initiation of the Corporate Insolvency Resolution Process and performing duties as outlined in Sections 15 and 18 of the Code. The IRP was required to report progress and compliance with the Tribunal's directions within 30 days. Effective Date of Corporate Insolvency Resolution Process: The commencement of the Corporate Insolvency Resolution Process was deemed effective from the date of the admission order, marking the initiation of formal proceedings for resolving the financial distress of the Corporate Debtor. This comprehensive analysis reflects the Tribunal's decision to admit the application, appoint an IRP, implement a Moratorium, ensure the continuation of essential services, and initiate the Corporate Insolvency Resolution Process effectively.
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