2019 (10) TMI 893 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Section 7 of the Insolvency and Bankruptcy Code 2016 - precise case of the Petitioner-Financial Creditor is that the total amount in default due to the financial creditor by the corporate debtor as on 03.05.2019 is 9, 91, 11, 819.00/- - ex-parte order - HELD THAT - The form and manner of the application has to be the one as prescribed. It is evident from the record that the application has been filed on the proforma prescribed under Rule 4 (2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules 2016 read with Section 7 of the Code - We are satisfied that a default amounting to lacs of rupees has occurred. As per requirement of Section 4 of the Code if default amount is one lac or more then the CIR Process would be issued. The application under sub-section 2 of Section 7 is complete; and no disciplinary proceedings are pending against the proposed Interim Resolution Professional. Petition admitted - moratorium declared.

Summary

Issues:
1. Application under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by the Financial Creditor for Corporate Insolvency Resolution Process.

Analysis:
The Financial Creditor, Corporation Bank, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of the Corporate Insolvency Resolution Process against M/s. J B Gold Private Limited. The Corporate Debtor had availed loan facilities from the Petitioner-Bank, which led to default on payments. Despite being served, the Corporate Debtor did not appear, resulting in an ex parte order. The Adjudicating Authority found the application complete and admitted it, appointing Mr. Mahesh Taneja as the Interim Resolution Professional.

Analysis:
The Tribunal examined the provisions of Section 7(2) and Section 7(5) of the IBC to ensure compliance. The application was filed in the prescribed form under Rule 4(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. The default amounting to a significant sum satisfied the criteria for initiating the Corporate Insolvency Resolution Process. As no disciplinary proceedings were pending against the proposed Resolution Professional, the petition was admitted, and Mr. Mahesh Taneja was appointed as the Interim Resolution Professional.

Analysis:
The Tribunal declared a moratorium under Section 14 of the Code, imposing restrictions on legal actions against the Corporate Debtor, asset transfers, and enforcement of security interests. Exceptions to the moratorium were specified, including essential services supply. The Interim Resolution Professional was directed to follow the Code's provisions diligently and ensure cooperation from all relevant parties. The Financial Creditor was instructed to deposit funds for the Interim Resolution Professional's expenses.

Analysis:
In addressing discrepancies in the statement of account, the Tribunal noted the role of the Information Utility and advised the Resolution Professional to seek corrections from the ex-promoter/director if needed. The Registrar of Companies was directed to update the Corporate Debtor's status promptly following the admission of the petition. The Resolution Professional was tasked with managing the affairs of the Corporate Debtor in compliance with the Code's provisions, ensuring transparency and integrity throughout the process.