2022 (4) TMI 257 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - territorial jurisdiction - time limitation - HELD THAT - As per Form V, Part IV, the Corporate Debtor is liable to pay an outstanding sum of ₹ 40,77,417/- along with interest 12% p.a. The date of default is 07.01.2017 as per Part IV but the acknowledgement by the corporate debtor in confirmation of account was made on 01.04.2019, hence the debt is not time barred and the application is filed within the period of limitation. The Applicant has filed an affidavit under section 9(3)(b) dated 28.01.2020 affirming that no notice of dispute has been given by the corporate debtor relating to dispute of the unpaid operational debt - The registered office of corporate debtor is situated in Delhi and therefore this Tribunal has jurisdiction to entertain and try this application. In the given facts and circumstances, the present application is complete and the operational creditor is entitled to claim its dues, which remain uncontroverted by the Corporate Debtor, establishing the default in payment of the operational debt beyond doubt. The present application is admitted, in terms of section 9 (5) of IBC, 2016. Application admitted - moratorium declared.

Issues:
1. Application under section 9 of Insolvency and Bankruptcy Code, 2016 for initiating Corporate Insolvency process.
2. Unpaid debt by Corporate Debtor to Operational Creditor for Advertising Services.
3. Failure of Corporate Debtor to pay outstanding amount leading to application under IBC, 2016.
4. Ex-parte proceedings due to non-appearance of Corporate Debtor.
5. Jurisdiction of the Tribunal to entertain the application.
6. Appointment of Interim Resolution Professional.
7. Direction for deposit by Operational Creditor with the Interim Resolution Professional.
8. Implementation of moratorium under Section 14 of the IBC, 2016.

Analysis:

1. The application was filed under section 9 of the Insolvency and Bankruptcy Code, 2016 by the Operational Creditor to initiate the Corporate Insolvency process against the Corporate Debtor, who failed to pay an outstanding amount of ?40,77,417 for Advertising Services provided as per the contract.

2. The Operational Creditor highlighted that despite completing the work as agreed upon within the stipulated time, the Corporate Debtor did not pay the due amount. The debt was acknowledged by the Corporate Debtor's Director in the confirmation of accounts, and a demand notice was issued under the I & B Code, 2016, which the Corporate Debtor failed to respond to with any evidence of a preexisting dispute.

3. The Tribunal proceeded ex-parte against the Corporate Debtor as they neither filed a reply nor appeared before the Bench. The Tribunal found the application valid as the debt was not time-barred, and the Operational Creditor had followed due process in serving the application and notices to the Corporate Debtor.

4. With the jurisdiction established, the Tribunal admitted the application, noting the uncontested default by the Corporate Debtor in payment. An Interim Resolution Professional was appointed, and the Operational Creditor was directed to deposit a sum with the IRP to cover expenses, subject to adjustment by the Committee of Creditors.

5. The admission of the application triggered a moratorium under Section 14 of the IBC, 2016, prohibiting certain actions against the Corporate Debtor. The Tribunal directed communication of the order to all relevant parties and authorities for compliance and record-keeping purposes, ensuring the due process and legal requirements are met in the insolvency proceedings.

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