2022 (1) TMI 669 - Tri - Insolvency and Bankruptcy

Maintainability 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 - Since the application filed by the Applicant fulfilled all the conditions required under Section 7 of the Code, this Tribunal ordered issue of notice to the Respondent by all modes. No one has represented on behalf of the Respondent. Despite service of notice by all modes, none appeared on behalf of the Respondent and as a result the Respondent was proceeded ex-parte by order dated 12.10.2021. The Applicant has established the existence of debt and default on the part of the Respondent and the Respondent has not availed the opportunities provided by this Tribunal to defend the arguments made by the Applicant. In view of the above situation, this Tribunal admits this petition and initiates CIRP on the Respondent with immediate effect. Application admitted - moratorium declared.

Summary

Issues:
- Application for corporate insolvency resolution process under Section 7 of the Insolvency and Bankruptcy Code 2016.
- Default in settling an amount by the Respondent.
- Absence of the Respondent during the proceedings.
- Admission and initiation of CIRP by the Tribunal.
- Imposition of moratorium under Section 14 of the Code.
- Appointment of interim resolution professional.

Analysis:
1. The application was filed by M/s. Paisalo Digital Ltd. against M/s. Ram Lal Kamal Raj Jewellers Private Limited under Section 7 of the Insolvency and Bankruptcy Code 2016 for defaulting on settling an amount of ?24,28,202. The Applicant provided details of the transactions leading to the application, demonstrating the debt and default by the Respondent.

2. Despite fulfilling all conditions under Section 7, the Respondent did not appear during the proceedings, leading to an ex-parte order against them. The Tribunal issued notice by all modes, but no representation was made on behalf of the Respondent, resulting in them being proceeded against ex-parte.

3. During the hearing, the Applicant's counsel presented arguments and documents establishing the debt and default by the Respondent. The Respondent remained absent, failing to defend against the Applicant's claims. Consequently, the Tribunal admitted the petition and initiated the corporate insolvency resolution process against the Respondent.

4. Following the admission, the Tribunal imposed a moratorium in accordance with Section 14 of the Code, restricting various actions against the Respondent, including suits, asset disposal, and recovery proceedings. Essential supplies to the Respondent were protected during this period, and the moratorium would remain in effect until the completion of the corporate insolvency resolution process.

5. The Tribunal confirmed the appointment of Mr. Dinesh Chandra Aggrawal as the interim resolution professional proposed by the Applicant. Mr. Aggrawal was tasked with taking necessary steps under the statute, particularly Sections 15, 17, and 18 of the Code, and was required to submit a report to the Tribunal within 30 days.