2022 (5) TMI 1252 - 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 - Proper service of notice - HELD THAT - The demand notice was received as per the tracking report mentioned at Annexure P-2 of the main petition. In view of the same, it is held that the demand notice has been duly served. Whether the operational debt was disputed by the corporate debtor? - HELD THAT - It is pleaded by the petitioner that no notice has been received to the demand notice dated 09.01.2020 from the corporate debtor. It is also pleaded that there is no dispute of unpaid operational debt pending between the parties in any court of law or any other authority. The same has been inferred from the affidavit in terms of Section 9(3)(b) of I B Code, 2016. The affidavit is attached to the main petition. It implies that there is no pre-existing dispute in relation to the debt claimed as per Part IV of Form 5. Whether this application is filed within limitation? - HELD THAT - The period of limitation would begin from the date of default mentioned in Part IV, Form V i.e. 12.10.2019. This application was initially filed on 22.12.2020 and thereafter re-filed on 05.01.2021 vide Diary No. 1931. Therefore, this Adjudicating Authority finds that this application was filed within limitation. It is noted that the corporate debtor has failed to make payment of the aforesaid amount due as mentioned in the statutory notice till date. Thus, the conditions under Section 9 of the Code stand satisfied. It is evident from the abovementioned facts that the liability of the corporate debtor is undisputed and admitted when Ld, counsel for respondent-corporate debtor stated that due to the financial crunch corporate debtor is unable to pay back the debt. Accordingly, the petitioner proved the debt and the default, which is above the threshold limit. It is seen that the petition preferred by the petitioner is complete in all respect. The material on record clearly goes to show that the respondent committed default in payment of the claimed operational debt even after demand made by the petitioner - in the present petition, all the aforesaid requirements have been satisfied - petition admitted - moratorium declared.

Summary

Issues:
1. Initiation of Corporate Insolvency Resolution Process under Section 9 of the Insolvency and Bankruptcy Code, 2016.
2. Proper service of demand notice.
3. Dispute of operational debt by the corporate debtor.
4. Filing of application within limitation.
5. Completeness of the application and proof of debt and default.

Analysis:
1. The petition filed under Section 9 of the Insolvency and Bankruptcy Code sought to initiate the Corporate Insolvency Resolution Process against the Corporate Debtor, PNC Enterprises Private Limited. The petitioner, an Operational Creditor, claimed an unpaid operational debt of Rs. 1,02,98,659 along with interest, supported by invoices, ledger accounts, and bank statements.

2. The issue of proper service of the demand notice was raised. The tracking report indicated the demand notice was duly served, satisfying the requirement of service under the Code.

3. Concerning the dispute of operational debt by the corporate debtor, it was noted that no notice disputing the debt was received, and there was no pending dispute in any court or authority, as affirmed by the affidavit attached to the petition.

4. The application's filing within limitation was crucial. The application was initially filed on 22.12.2020 and re-filed on 05.01.2021, well within the limitation period from the date of default, which was 12.10.2019.

5. The completeness of the application and proof of debt and default were thoroughly examined. The unpaid operational debt, along with evidence such as invoices, ledger accounts, and statements, was found to be substantiated. The Corporate Debtor's failure to pay the debt, despite acknowledgment, led to the satisfaction of conditions under Section 9 of the Code.

6. Consequently, the Tribunal admitted the petition for the initiation of the Corporate Insolvency Resolution Process, declared a moratorium, and appointed an Interim Resolution Professional. Directions were provided for the management of the Corporate Debtor's affairs, including the constitution of a Committee of Creditors and regular progress reporting.

7. Additionally, the petitioner was directed to deposit a specified amount with the Interim Resolution Professional to cover immediate expenses, to be reimbursed by the Committee of Creditors. The order was communicated to both parties and the Interim Resolution Professional promptly.

This detailed analysis encapsulates the key aspects and decisions of the judgment, addressing the issues raised in the petition comprehensively.