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2022 (5) TMI 1307 - 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 - HELD THAT - It is clear from the pleadings that the Operational Creditor has supplied the goods to the Corporate Debtor as evident from invoices annexed. Furthermore, there is no evidence placed by the corporate debtor on record to show that there is pre-existing dispute before issuing statutory notice u/s. 8 of IBC, 2016. The Corporate Debtor also issued cheques to discharge its liability as is evident from the ledger account, which amounts to acknowledgement of debt and same got dishonored on presentation. Therefore, default in payment of outstanding principal amount is evident from the bank statement annexed with petition - Since, all the conditions are satisfied by the operational creditor, hence, this authority is inclined to initiate the CIR Process of Corporate Debtor, therefore, the captioned petition is admitted. Petition admitted - moratorium declared.
Issues:
1. Initiation of Corporate Insolvency Resolution Process under Section 9 of IBC, 2016. 2. Maintainability of the petition. 3. Default in payment by the Corporate Debtor. 4. Appointment of Interim Resolution Professional. 5. Declaration of moratorium and related prohibitions. 6. Compliance with various provisions of the Insolvency and Bankruptcy Code. Issue 1: Initiation of Corporate Insolvency Resolution Process under Section 9 of IBC, 2016: The Operational Creditor, M/s. Shera Metal Private Limited, filed a petition seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, M/s. Unilec Engineers Limited, under Section 9 of the Insolvency & Bankruptcy Code, 2016. The petition detailed the continuous supply of goods by the Operational Creditor to the Corporate Debtor, the default in payment of the principal amount, and the subsequent demand notice sent by the Operational Creditor. The Tribunal found that the conditions for initiating the CIRP were satisfied, as evidenced by the ledger account and the dishonored cheques issued by the Corporate Debtor. Therefore, the petition was admitted, and an Insolvency Professional was appointed as the Interim Resolution Professional to manage the Corporate Debtor's affairs. Issue 2: Maintainability of the petition: The Corporate Debtor raised objections regarding the maintainability of the petition, citing lack of authorization to institute the insolvency proceeding, non-delivery of the demand notice as per Section 8 of IBC, 2016, and absence of acknowledgment or acceptance of invoices. The Tribunal noted that there was no evidence of a pre-existing dispute before the statutory notice was issued. It further observed that the Corporate Debtor had acknowledged the debt by issuing cheques that were subsequently dishonored. The Tribunal dismissed the objections raised by the Corporate Debtor and proceeded to admit the petition for initiating the CIRP. Issue 3: Default in payment by the Corporate Debtor: The Corporate Debtor contested the default in payment, alleging delayed deliveries by the Operational Creditor, which led to financial liabilities for the Corporate Debtor. However, the Tribunal found that the default in payment of the outstanding principal amount was evident from the bank statement and the dishonored cheques. The Tribunal emphasized that the conditions for default were met, and the Corporate Debtor's objections were not substantiated, leading to the admission of the petition. Issue 4: Appointment of Interim Resolution Professional: The Tribunal appointed an Insolvency Professional, Mr. Tara Chand Sharma, as the Interim Resolution Professional, in accordance with the proposal made by the Operational Creditor. The Interim Resolution Professional was tasked with taking immediate charge of the Corporate Debtor's management, making a public announcement, and inviting submissions of claims as per the provisions of the IBC, 2016. Issue 5: Declaration of moratorium and related prohibitions: A moratorium was declared from the date of the order until the completion of the CIRP, prohibiting various actions such as instituting suits, transferring assets, enforcing security interests, and recovering property. The Tribunal also ensured that the supply of essential goods or services to the Corporate Debtor would not be disrupted during the moratorium period, in line with the provisions of the IBC, 2016. Issue 6: Compliance with various provisions of the Insolvency and Bankruptcy Code: The Tribunal directed the IRP to comply with specific sections of the Code, while also instructing the directors, promoters, and management associates of the Corporate Debtor to extend cooperation to the IRP. Additionally, the Operational Creditor was tasked with providing a copy of the order to the IRP promptly for compliance purposes. The Registry was instructed to inform the Registrar of Companies for updating the Corporate Debtor's status on the Ministry of Corporate Affairs website. This detailed analysis of the judgment comprehensively covers the issues involved and the Tribunal's decision on each aspect of the case.
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