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2017 (4) TMI 675 - Tri - Insolvency and BankruptcyInitiating corporate insolvency resolution process - Held that - The figures extracted indicate the losses and fall in revenue. It seems that the applicant has fallen into debt trap and is competent to set in motion the insolvency resolution process as contemplated under the Code . On the basis of the aforesaid statements the total debt raised by the Corporate Applicant with regard to the financial and operational creditors is ₹ 18.48 crores and it is further represented that the total amount of default is ₹ 18.29 crores. In view of the aforesaid discussion, the instant petition deserves to be admitted, it is, however, observed that the Applicant Company save some sketchy particulars has not given any road map as to how it is going to keep itself afloat as a going concern. However, keeping in perspective the objects for which the Code has been brought into force and to balance the interest of all stakeholders, we are satisfied that the instant application warrants to be admitted to prevent further erosion of capital and to safeguard the assets of the Applicant Company/Corporate Debtor Directions to Appoint Mr. Jalesh Kumar Grover resident of House No.202, GH No,40, Sector 20, Panchkula-134113 (Haryana), Mobile No.09501081808, emait; [email protected] Registration No. IBBI/IPA-G01/IP-00136/2Q16-17/1259, a Registered insolvency Professionat (IRP) as the Interim Resolution Professional as contemplated under Section 16 of the Code1 and his term of appointment shall be for a period of thirty days from the date of this order or as may be determined by the Committee of Creditors whichever is earlier; In terms of Section 17 of the Code , from the date of his appointment, the powers of the Board of Directors shall stand suspended and the management of the affairs shall vest with the Interim Resolution Professional and the officers and the managers of the Corporate Debtor shah report to the interim Resolution Professional.It is hereby directed that the Corporate Debtor , its properties, personnel and persons associated with the management shall extend all cooperation to the Interim Resolution Professional in managing the affairs of the Corporate Debtor1 as a going concern and extend ail cooperation in accessing books and records as well as assets of the Corporate Debtor .
Issues Involved:
1. Application for initiating corporate insolvency resolution process. 2. Financial status and creditors of the Corporate Debtor. 3. Appointment and qualifications of the Interim Resolution Professional. 4. Compliance with the Insolvency and Bankruptcy Code, 2016. 5. Declaration of moratorium. Issue-wise Detailed Analysis: 1. Application for Initiating Corporate Insolvency Resolution Process: The application was filed by M/s Sky Blue Papers Private Limited, a 'Corporate Debtor', in Form 6 as per Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. The application was made under Sections 10, 13, and 14 of the Insolvency and Bankruptcy Code, 2016. The 'Corporate Debtor' qualifies as a 'Corporate Applicant' under Section 5(5) of the Code. 2. Financial Status and Creditors of the Corporate Debtor: The Applicant Company was incorporated on 06.03.2014. It has an authorized share capital of ?2,50,00,000 and a subscribed and paid-up share capital of ?2,35,00,000. The company has two directors, Ashwani Soni and Sahil Arora. The financial creditors include Punjab National Bank, Kotak Mahindra Prime Ltd., and Tata Capital Financial Services Ltd., with a total debt raised amounting to ?16.81 crores. The unsecured creditors include Ashwani Soni and Sahil Arora with a total debt of ?3.57 crores. The operational creditors include government departments, raw material suppliers, workers/employees, and service providers with a total debt of ?1.89 crores. The total amount of default is ?18.29 crores. 3. Appointment and Qualifications of the Interim Resolution Professional: The applicant proposed Mr. Jalesh Kumar Grover as the Interim Resolution Professional (IRP). He has filed written communication in Form 2 to act as IRP and declared his eligibility as per the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. He also declared that no disciplinary proceedings are pending against him and he is not related to the Applicant Company. 4. Compliance with the Insolvency and Bankruptcy Code, 2016: The application was filed in compliance with Section 10 of the Code, which requires the existence of a 'Corporate Debtor' who has committed a default. The application must be filed in the prescribed form, accompanied by necessary documents and information, including the proposed Resolution Professional. The Tribunal has the discretion to admit or reject the application, providing an opportunity to rectify defects if any. 5. Declaration of Moratorium: The Tribunal declared a moratorium under Section 14 of the Code, which includes: (a) The institution or continuation of suits or proceedings against the 'Corporate Debtor'. (b) Transferring, encumbering, or disposing of any assets of the 'Corporate Debtor'. (c) Actions to foreclose or recover any security interest created by the 'Corporate Debtor'. (d) Recovery of any property occupied by the 'Corporate Debtor'. Conclusion: The Tribunal admitted the application, appointed Mr. Jalesh Kumar Grover as the Interim Resolution Professional, and declared a moratorium. The IRP is directed to manage the affairs of the 'Corporate Debtor', constitute the Committee of Creditors, and make a public announcement of the initiation of the Corporate Insolvency Resolution Process. The IRP is also required to file weekly reports to the Tribunal.
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