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2022 (2) TMI 795 - 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 - Service of demand notice - HELD THAT - The demand notice dated 06.08.2019 was sent via registered post and email on 07.08.2019 to the corporate debtor and its directors. The postal receipt and tracking report are found to be attached at Page 647-652 (Annexure-9) of the Application. Whether the operational debt was disputed by the Respondent? - HELD THAT - The Respondent Corporate Debtor has filed reply and argued that they had been dissatisfied with the supply and the quality of the goods however they have not submitted any communication to substantiate the same. Thus, as per documents placed on record with the adjudicating authority, there is no dispute as to the outstanding liability of the Respondent Corporate Debtor towards the Applicant Operational Creditor. It has been shown that the Corporate Debtor has failed to make payment of the aforesaid amount due as mentioned in the statutory notice till date. It is also observed that the conditions under Section 9 of the Code stand satisfied. Hence, this Adjudicating Authority is inclined to commence CIRP against the Corporate Debtor as envisaged under the provisions of IBC, 2016. Application admitted - moratorium declared.
Issues: Application under Section 9 of the Insolvency and Bankruptcy Code, 2016 for initiation of Corporate Insolvency Resolution Process against a Corporate Debtor.
Analysis: 1. Background and Jurisdiction: The Applicant, an Operational Creditor, filed an application under Section 9 of the IBC against the Respondent, a public limited company. The Applicant claimed an outstanding amount of ?2,13,16,728 against the Respondent for delayed payments. The Respondent argued against the claim, citing disputes regarding supply and quality of goods. The Adjudicating Authority found the application to be within the jurisdiction and not time-barred, as the last payment was made on 07.03.2017, and the application was filed on 15.10.2019. 2. Service of Demand Notice: The first issue considered was whether the demand notice was properly served on the Respondent. The demand notice was sent via registered post and email on 06.08.2019, with supporting evidence attached to the application. The Adjudicating Authority confirmed the proper delivery of the notice to the Respondent. 3. Dispute of Operational Debt: The Respondent disputed the operational debt, claiming dissatisfaction with the goods supplied. However, the Respondent failed to provide evidence to support their claim of dispute. The Adjudicating Authority found no substantial dispute regarding the outstanding liability of the Respondent towards the Applicant. 4. Admission of CIRP: The Adjudicating Authority found the Applicant's claim to be valid, with unpaid operational debt and interest. As the Respondent failed to make payments, the conditions under Section 9 of the Code were satisfied. Consequently, the Adjudicating Authority decided to commence the Corporate Insolvency Resolution Process (CIRP) against the Respondent. 5. Appointment of IRP: The Applicant proposed the name of an Interim Resolution Professional (IRP), Mr. Prashant Agrawal, who was duly appointed by the Adjudicating Authority. The IRP was directed to undertake all necessary steps under the Code and manage the affairs of the Corporate Debtor during the CIRP. 6. Consequences of CIRP: Following the admission of CIRP, the IRP was instructed to take over the Corporate Debtor's affairs, issue necessary publications, and manage the CIRP within the specified timelines. A moratorium under Section 14 of the Code was invoked, and the Applicant was directed to deposit funds for the IRP's expenses. The management of the Corporate Debtor was vested in the IRP, and all stakeholders were required to cooperate during the process. 7. Communication and Compliance: The Adjudicating Authority ordered the communication of the decision to all relevant parties and the IRP within a week. Additionally, the order was to be conveyed to the Insolvency and Bankruptcy Board of India (IBBI) for record-keeping purposes. In conclusion, the Adjudicating Authority admitted the application, appointed an IRP, and initiated the CIRP against the Corporate Debtor based on the merits of the case and compliance with the provisions of the Insolvency and Bankruptcy Code, 2016.
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