2018 (7) TMI 2290 - AT - Insolvency and Bankruptcy

Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of dispute or not - HELD THAT - In the present case, as we find that there is a debt and the Corporate Debtor defaulted in payment of debt to the Financial Creditor . The application being complete, it is held that the Adjudicating Authority rightly admitted the application. There are no ground to interfere with the impugned order dated 12th March, 2018 - appeal dismissed.

Summary

Issues Involved:
Challenge to order admitting application under Section 7 of the Insolvency and Bankruptcy Code, 2016.

Analysis:
The judgment by the National Company Law Appellate Tribunal, New Delhi, involved a challenge by the Appellant-Shareholder against the order passed by the Adjudicating Authority admitting the application under Section 7 of the Insolvency and Bankruptcy Code, 2016. The application was filed by the Respondents for the initiation of the Corporate Insolvency Resolution Process of a specific company, referred to as the 'Corporate Debtor.'

The Appellant's Senior Counsel argued that there was a dispute between the Corporate Debtor and the Financial Creditor, which had been referred to arbitration. However, it was noted that such a dispute could not be used to oppose an application under Section 7 of the Insolvency and Bankruptcy Code. This ground could only be considered if the application had been made under Section 9 of the I&B Code.

Upon examination of the case, it was found that there was indeed a debt, and the Corporate Debtor had defaulted in payment to the Financial Creditor. The Adjudicating Authority had correctly admitted the application as it was deemed complete. Consequently, the National Company Law Appellate Tribunal found no reason to interfere with the order dated 12th March, 2018. The appeal was dismissed, and no costs were awarded in this matter.