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2021 (12) TMI 5 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT - In the instant case there is a financial debt and there has been a default in repayment of the same and that this Adjudicating Authority is satisfied that the Financial Creditor has proved its case by placing evidence that default has occurred for which the Corporate Debtor was liable to pay. Even the Corporate Debtor acknowledges the debt and default, but seeks time for repayment of the said financial debt. The Financial Creditor has fulfilled all the stipulations as required under the provisions of the IB Code, 2016 for the purpose of initiating Corporate Insolvency Resolution Process. In these circumstances, having satisfied with the submissions made by the Petitioner/Financial Creditor, the contentions of the Corporate Debtor are overruled and this Adjudicating Authority is inclined to admit the instant Application - the instant application is hereby admitted and this Adjudicating Authority orders the commencement of the Corporate Insolvency Resolution Process (CIRP) which shall ordinarily be completed within the timelines stipulated in the IB Code, 2016 (as amended), reckoning from the day of this order is passed. Application admitted - moratorium declared.
Issues:
Application for initiation of Corporate Insolvency Resolution Process under section 7 of the Insolvency and Bankruptcy Code, 2016. Analysis: Issue 1: Application for CIRP The Application was filed by M/s. Bharani Commodities Private Limited as the Financial Creditor against M/s. B.P. Ferrium Industries Private Limited for initiation of Corporate Insolvency Resolution Process (CIRP) under section 7 of the Insolvency and Bankruptcy Code, 2016. The Financial Creditor alleged that the Corporate Debtor defaulted in payments amounting to ?23,39,32,333/- and despite efforts, the debt remained unpaid. The Corporate Debtor, while acknowledging the debt, sought time for repayment, citing financial difficulties. Issue 2: Adjudication and Decision After considering submissions from both parties and perusing the record, the Adjudicating Authority found a financial debt and default by the Corporate Debtor. The Financial Creditor had fulfilled all requirements under the IB Code, 2016 for initiating CIRP. Citing the Supreme Court's decision in a related case, the Authority admitted the Application, ordering the commencement of CIRP. Mr. Krishna Komaravolu was appointed as the Interim Resolution Professional (IRP) to manage the Corporate Debtor's affairs. Issue 3: Moratorium and Directions A moratorium was declared from the date of the order till the completion of CIRP, prohibiting various actions against the Corporate Debtor's assets. Essential goods or services supply was to continue, and the IRP was directed to comply with specific provisions of the Code. Directors and associated persons were instructed to cooperate with the IRP. The Financial Creditor was directed to pay an advance fee to the IRP, and the Registry was tasked with communication and compliance responsibilities. In conclusion, the Adjudicating Authority admitted the Application, initiating CIRP against the Corporate Debtor, and appointed an IRP to oversee the resolution process. The moratorium was declared, and specific directions were issued to ensure compliance with the Code and cooperation from relevant parties.
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