2022 (2) TMI 1242 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Guarantee executed by the Personal Guarantor in favour of the Financial Creditor - existence of debt and dispute or not - HELD THAT - The present Application has been filed through the Resolution Professional for which, due authorization by the Financial Creditor, i.e. Bank of Baroda has also been placed on record. The consent given by the proposed IRP along with the relevant papers have also been placed on record for consideration by this Tribunal - It is seen that Authorization for Assignment (AFA) has also been filed by the applicant and the same is valid upto 10.11.2022. The Applicant/Financial Creditor has made out a prima-facie case against the Personal Guarantor for initiation of the proceedings under Section 95 of the Code. application admitted - moratorium declared.

Summary

Issues:
1. Application for initiation of insolvency proceedings against Personal Guarantor under Section 95 of the Code.
2. Appointment of Resolution Professional.
3. Commencement of Interim Moratorium under Section 96 of the Code.

Analysis:
1. The Application filed under Rule 7(2) seeks initiation of insolvency proceedings against the Personal Guarantor in accordance with Section 95 of the Code. The Counsel presented the Guarantee executed by the Personal Guarantor in favor of the Financial Creditor regarding the loan taken by the Corporate Debtor, ANG Industries Limited.

2. The Application, filed through the Resolution Professional with due authorization from the Financial Creditor, Bank of Baroda, has been supported by the necessary Authorization for Assignment (AFA) valid until 10.11.2022. The Tribunal is satisfied that the Applicant/Financial Creditor has established a prima facie case for initiating proceedings under Section 95 of the Code.

3. Consequently, Mr. Deepak Mittal, a Resolution Professional, is appointed to examine the Application and submit a report within ten days. An Interim Moratorium under Section 96 of the Code is declared to commence from the date of filing the Application, staying legal actions or proceedings related to debts. The Resolution Professional is directed to proceed with the matter and submit a report as per Section 99 of the Code within the prescribed time.

4. The Tribunal directs listing the matter on 23.3.2022 for further proceedings. The judgment outlines the legal provisions of Section 96 of the Code, emphasizing the implications of the interim moratorium on debt-related legal actions and the role of the Resolution Professional in the insolvency process.