2020 (2) TMI 53 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - Existence of debt and dispute or not - HELD THAT - The application made by the Operational Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable, and the default is in excess of minimum amount of one lakh rupees stipulated under section 4(1) of the IBC. Therefore, the default stands established and there is no reason to deny the admission of the Petition. In view of this, this Adjudicating Authority admits this Petition and orders initiation of CIRP against the Corporate Debtor. Petition admitted - moratorium declared.

Summary

Issues:
Company Petition under section 9 of IBC seeking initiation of CIRP against Corporate Debtor for non-payment of dues.

Analysis:
The Company Petition was filed by an Operational Creditor against a Private Limited Company, the Corporate Debtor, for failing to pay a sum of ?6,53,000 along with interest. The Operational Creditor, engaged in dealing with audio-video systems, supplied goods on credit basis to the Corporate Debtor, who acknowledged receipt by accepting delivery challans. Despite making partial payments, the Corporate Debtor defaulted on the outstanding amount. The Operational Creditor served a Demand Notice as per IBC guidelines, which went unanswered by the Corporate Debtor.

The Adjudicating Authority found the Operational Creditor's application complete and in compliance with the law. The Corporate Debtor's default was established, exceeding the minimum amount stipulated under IBC. The Authority noted the undisputed supply of goods, acceptance, and partial payments made by the Corporate Debtor. As the Corporate Debtor failed to respond or represent itself, the Petition was admitted, and CIRP was initiated against the Corporate Debtor.

The Order included a moratorium under section 14 of IBC, prohibiting certain actions against the Corporate Debtor's assets. Essential supplies to the Corporate Debtor were to continue during the moratorium. The Authority directed the appointment of an Interim Resolution Professional (IRP) and outlined the responsibilities and powers of the IRP during the CIRP period. The management of the Corporate Debtor was vested in the IRP, and the Operational Creditor was required to deposit funds for public notice expenses. The Registry was instructed to communicate the Order to the relevant parties promptly. Additionally, the Registrar of Companies was to update the Corporate Debtor's Master Data and provide a compliance report to the Court.

In conclusion, the Tribunal admitted the Company Petition, ordered the initiation of CIRP against the Corporate Debtor, and implemented necessary measures to facilitate the resolution process in accordance with the Insolvency & Bankruptcy Code.