2019 (9) TMI 1124 - Tri - Insolvency and Bankruptcy

Admissibility of application - initiation of CIRP - Corporate Debtor - Amount outstanding against the Corporate Debtor which the Corporate Debtor failed to pay - HELD THAT - The Operational Creditor has fulfilled all the requirements of law for admission of the Application. This Authority is satisfied that the Corporate Debtor has committed default in making payment of the outstanding debt claimed by the Operational Creditor. Therefore, Application is admitted and the commencement of the Corporate Insolvency Resolution Process is ordered, which ordinarily shall get completed within 180 days, reckoning from the day this order is passed. Petition admitted - moratorium declared.

Summary

Issues:
Admission of application under Section 9 of the Insolvency & Bankruptcy Code, 2016 for Corporate Insolvency Resolution Process.

Analysis:
The judgment pertains to an application filed by an Operational Creditor under Section 9 of the Insolvency & Bankruptcy Code, 2016 seeking admission to initiate the Corporate Insolvency Resolution Process against the Corporate Debtor. The Operational Creditor claimed an outstanding amount against the Corporate Debtor, which the latter failed to pay. The dispute arose from a Memorandum of Understanding (MoU) between the parties, where the Corporate Debtor defaulted on payments for rented equipment and issued dishonored cheques. The Operational Creditor issued a Demand Notice under Section 8 of the I&B Code, 2016, but received no response from the Corporate Debtor. The Operational Creditor fulfilled all legal requirements for admission of the application, and the Tribunal found the Corporate Debtor in default, admitting the application and ordering the commencement of the Corporate Insolvency Resolution Process.

Moratorium and Appointment of IRP:
The Tribunal declared a moratorium effective from the date of the order till the completion of the Corporate Insolvency Resolution Process, prohibiting various actions against the Corporate Debtor. Mr. V. Duraisamy was appointed as the Interim Resolution Professional (IRP) to manage the affairs of the Corporate Debtor. The IRP was directed to take charge immediately, make a public announcement, and call for submissions of claims by creditors. The Directors, Promoters, and management associates of the Corporate Debtor were instructed to cooperate with the IRP as per the provisions of the Insolvency & Bankruptcy Code, 2016.

Compliance and Communication:
The IRP was mandated to comply with specific sections of the Code, and the Operational Creditor and Registry were directed to provide a copy of the order to the IRP promptly. The address and contact details of the appointed IRP were specified for communication purposes. The Registry was further instructed to communicate the order to the Operational Creditor, Corporate Debtor, and the relevant Registrar of Companies (RoC).

This detailed judgment by the National Company Law Tribunal Single Bench in Chennai addresses the legal aspects of admission of an application under the Insolvency & Bankruptcy Code, 2016, the declaration of a moratorium, appointment of an IRP, and compliance requirements for all parties involved in the Corporate Insolvency Resolution Process.