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2022 (6) TMI 1328 - Tri - Insolvency and BankruptcyMaintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Personal Guarantor to Corporate Debtor - section 95 of IBC - HELD THAT - On the conjoint reading of the provisions show that Rule 10 of IBBI (application to Adjudicating Authority for Insolvency Resolution Process or Personal Guarantor to Corporate Debtor) Rules 2019, prescribed the procedure for filing of the application and documents under Chapter-III and Part-III of the application and as per the Rule 10 of the Adjudicating Authority Rules, the provisions of the NCLT Rules are applicable. The provisions referred to Rule 10 are relate to the presentation of the petition or appeal. On conjoint reading of the provisions shows that neither in Section 94 nor in Section 95, the word filing is referred. Rather in both the Sections 94 95, the word submitting an application is mentioned. The debtor or the creditor under Section 94 95 respectively may apply either personally or through Resolution Professional for initiating the Insolvency Resolution Process by submitting an application - in terms of the Section 96 of the IBC, 2016, when an application is filed under Section 94 95, an interim moratorium shall commence on the date of the application in relation to all the debts and shall cease to an effect on the date of admission of such application. Petition admitted - moratorium declared.
Issues Involved:
1. Maintainability of the application under Section 94 filed by the Respondent/Guarantor. 2. Commencement of interim moratorium under Section 96 of the Insolvency and Bankruptcy Code (IBC), 2016. 3. Interpretation of "filing" under Section 96 of the IBC. Detailed Analysis: 1. Maintainability of the Application under Section 94: The Applicant, State Bank of India, argued that the application under Section 94 filed by the Respondent/Guarantor was not maintainable. The Applicant had already filed an application under Section 95 on 01.10.2021, which initiated an interim moratorium as per Section 96(1) of the IBC. The Respondent's application under Section 94 was filed on 25.10.2021, after the Applicant's filing. The Applicant contended that any subsequent application under Section 94 should be dismissed due to the interim moratorium already in place. 2. Commencement of Interim Moratorium: The Applicant emphasized that the interim moratorium under Section 96 of the IBC commences automatically upon the filing of an application under Section 95. This was supported by the Hon'ble NCLAT's interpretation in Ravi Ajit Kulkarni vs. State Bank of India, which stated that the interim moratorium starts immediately when the application is filed, without any need for adjudication. The Applicant argued that the moratorium began on 01.10.2021, the date of filing, and thus, the Respondent's application under Section 94 filed later was not maintainable. 3. Interpretation of "Filing" under Section 96: The Respondent contended that "filing" under Section 96 should be interpreted as the "numbering" of the petition, not merely the submission of documents. The Respondent argued that the application under Section 94 was numbered on 22.12.2021, before the Applicant's application under Section 95, which was numbered on 18.02.2022. Therefore, the Respondent claimed that their application should be considered as filed first. The Tribunal, however, disagreed with the Respondent's interpretation. It referred to Rule 2(14) of the NCLT Rules, which defines "filed" as the date when the application is submitted to the Registry. The Tribunal clarified that the interim moratorium under Section 96 commences on the date of filing, not the date of numbering. The Tribunal observed that the Applicant's application was filed on 01.10.2021, and the Respondent's application was filed later, making the latter not maintainable due to the interim moratorium already in effect. Conclusion: The Tribunal concluded that the interim moratorium under Section 96 commenced on the date of filing of the Applicant's application under Section 95, i.e., 01.10.2021. Consequently, any subsequent application filed by the Respondent under Section 94 was not maintainable. The Tribunal appointed Mr. Chanchal Dua as the Resolution Professional to exercise powers under Section 99 of the IBC and directed the Applicant to serve the necessary documents to the Resolution Professional. The matter was listed for further hearing on 14.07.2022.
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