2019 (3) TMI 51 - Tri - Insolvency and Bankruptcy

Corporate Insolvency process - default in payment of claimed amount - HELD THAT - From the definition of Operational creditor and Operational Debt , it can be seen that the applicant has supplied goods to the respondent company and therefore clearly comes within the definition of Operational Creditor Similarly the claim of outstanding payments to applicant comes within the definition of Operational Debt. There being default in payment of claimed amount, and the respondent has failed to establish the fact that there is a pending dispute between the parties, such application deserves to be admitted for triggering Corporate Insolvency Resolution Process against the respondent corporate debtor. We are satisfied that the present application is complete and there has been default in payment of dues by the respondent. Therefore, on fulfilment of the requirements of section 9(5)(i)(a) to (d) of the Code, the present application is admitted. In pursuance of Section 13(2) of the Code we direct that public announcement shall be made by the Interim Resolution Professional immediately (3 days as prescribed by Regulations) with regard to admission of this application under Section 7 of the Code.

Summary

Issues involved:
Application under section 9 of the Insolvency and Bankruptcy Code, 2016 for initiation of Corporate Insolvency process.

Analysis:
The applicant, engaged in providing services, filed an application under section 9 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency against the respondent, a company dealing in perishable food products. The applicant claimed non-payment despite supplying goods and issuing invoices. The respondent failed to respond to the demand notice under Section 8 of the Code, leading to an ex parte proceeding. The Tribunal considered the definition of "Operational Creditor" and "Operational Debt" under the Code, finding the applicant eligible as an Operational Creditor due to the supply of goods to the respondent. With default in payment and no pending dispute established, the Tribunal admitted the application for Corporate Insolvency Resolution Process against the respondent.

Moratorium and Interim Resolution Professional:
The Tribunal declared a moratorium under Section 14 of the Code, prohibiting suits, asset transfers, and recovery actions against the corporate debtor. Exceptions were specified, including essential goods or services supply. The Interim Resolution Professional was appointed to manage the corporate debtor's affairs, with obligations outlined under various sections of the Code. The Tribunal directed communication of the order to relevant parties and appointed an Interim Resolution Professional to oversee the process. The petitioner was directed to pay a sum to the Interim Resolution Professional for expenses, subject to adjustment by the Committee of Creditors.

This detailed analysis covers the issues of the application under the Insolvency and Bankruptcy Code, the Tribunal's decision on admission, declaration of moratorium, appointment of an Interim Resolution Professional, and related directives for the resolution process.