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2021 (12) TMI 341 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - Pecuniary Jurisdiction - HELD THAT - The default, on the part of the Corporate Debtor is proved from the documents filed and the submissions made by the Learned Counsel by the Operational Creditor. Further, it is also pertinent to note that the default arising in the present Application is much prior to the advent of the Covid-19 pandemic and hence the Corporate Debtor also cannot seek shelter under Section 10A of IBC, 2016. Pecuniary Jurisdiction - HELD THAT - Further in relation to the 'Pecuniary Jurisdiction' even though the Threshold Limit' has been raised to ₹ 1 Crore as and from 24.03.2020 by virtue of a Notification issued under Section 4 of IBC, 2016, as regards the present Application, it is seen that the present Application has been filed on 24.8.2019, which is well before the Notification effected in increasing the threshold limit from ₹ 1 lakh to ₹ 1 Crore as on and from 24.03.2020 and as such this Tribunal has got the 'Pecuniary Jurisdiction' to entertain this Petition, as filed by the Operational Creditor - this Tribunal is left with no other option than to proceed with the present case and initiate the Corporate Insolvency Resolution Process in relation to the Corporate Debtor. The Petition, as filed by the Operational Creditor, is required to be admitted under Section 9(5) of the IBC, 2016. Since the Operational Creditor has not named the Insolvency Resolution Professional, this Tribunal based on the latest list furnished by the Insolvency and Bankruptcy Board of India applicable for the period between July to December 2021 - petition admitted - moratorium declared.
Issues: Application under Section 9 of the Insolvency and Bankruptcy Code, 2016 for Corporate Insolvency Resolution Process against a Private Limited Company.
Issue 1: Operational Creditor's Application Details The Application was filed by Indoflex Windpower Pvt. Ltd. against TRK Textile (India) Pvt. Limited seeking to initiate the Corporate Insolvency Resolution Process. The Operational Creditor is a Private Limited Company, while the Corporate Debtor is also a Private Limited Company incorporated in 2005. The Operational Creditor provided various documents to prove the debt, including bank certificates, invoices, bank statements, agreements, board resolutions, and correspondence. Issue 2: Default and Payment Dispute The Operational Creditor, engaged in Wind Power Generation, claimed that the Corporate Debtor defaulted in payment of a significant sum. Despite repeated reminders and termination of the power arrangement, the debt remained unpaid. The Operational Creditor highlighted the default amount and interest due, along with the communication regarding pending payments and verification of accounts. Issue 3: Legal Arguments and Disputes The Operational Creditor's counsel presented arguments regarding the default, admissions of the amount due by the Corporate Debtor, and partial payments made. The Corporate Debtor disputed the claim, alleging it to be premature, unsubstantiated, spurious, and inflated. The absence of a clause for interest payment was acknowledged, but the default amount exceeded the pecuniary limit. Issue 4: Jurisdiction and Admittance of Application The Tribunal established its pecuniary jurisdiction to entertain the petition, as it was filed before the threshold limit increase. The Tribunal admitted the Operational Creditor's petition under Section 9(5) of the IBC, 2016. An Interim Resolution Professional was appointed, and the Corporate Insolvency Resolution Process was initiated. The moratorium period was enforced, restricting certain actions against the Corporate Debtor. Issue 5: Moratorium and Resolution Process The moratorium period was detailed, specifying the actions prohibited during this time. Essential goods or services supply was protected, and critical supplies were to be maintained. The duration of the moratorium was linked to the completion of the Corporate Insolvency Resolution Process. The Operational Creditor was directed to pay a sum to the Interim Resolution Professional for necessary expenses. This detailed analysis covers the key aspects of the judgment, including the application details, default and disputes, legal arguments, jurisdictional issues, and the moratorium enforcement in the context of the Insolvency and Bankruptcy Code, 2016.
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