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2022 (7) TMI 14 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - Time Limitation - HELD THAT - In terms of the order dated 21.11.2019 and to remove the defects pointed out, the learned counsel for the petitioner filed compliance affidavit vide Diary no.6652 dated 27.11.2019 stating that the date of default mentioned in Form No.5 is unintentional and by mistake, and in fact the date of occurrence of default is 02.03.2013 and acknowledgement of the same was made on 07.03.2015 and again on 01.09.2017 as shown in the relevant balance sheets and hence, the CP is within limitation. Whether there is default in payment or not? - HELD THAT - It is observed from the record that in the present case, the occurrence of default is evidenced by the copy of the acknowledgement by the corporate debtor and the account statement of the Petitioner/Applicant and the same are attached as Annexure A-6 and Annexure A-7 A-8 respectively of the petition. The respondent-corporate debtor has also filed a reply wherein it has been admitted that there is default in respect of financial debt and amount mentioned in the petition is due towards the petitioner and shown its incapacity to pay the liability. The application filed in the prescribed Form No.1 is found to be complete. The present petition being complete and having established the default in payment of the Financial Debt for the default amount being above threshold limit, the petition is admitted in terms of Section 7(5) of the IBC and accordingly, moratorium is declared in terms of Section 14 of the Code. Accordingly, the petitioner proved the debt and the default, which is more than the threshold limit - Petition admitted - moratorium declared.
Issues Involved:
1. Filing of petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 for Corporate Insolvency Resolution Process. 2. Change of proposed Interim Resolution Professional. 3. Verification of default in payment and completeness of the application. 4. Appointment of Interim Resolution Professional. 5. Admission of the petition and declaration of moratorium. 6. Directions regarding the Committee of Creditors and progress reports. 7. Financial deposit by the Financial Creditor for expenses. Issue 1: Filing of Petition under Section 7 of the Insolvency and Bankruptcy Code: The petition was filed by the Financial Creditor to initiate the Corporate Insolvency Resolution Process against the Corporate Debtor. The petition detailed the loan agreement, default in repayments, and non-compliance with an arbitrator's award. The jurisdiction of the Tribunal was established as per the master data of the Corporate Debtor. Issue 2: Change of Proposed Interim Resolution Professional: A request was made to change the proposed Interim Resolution Professional due to prior commitments. The Tribunal allowed the replacement and appointed a new Interim Resolution Professional after verifying the credentials and ensuring no disciplinary proceedings against him. Issue 3: Verification of Default and Completeness of Application: The occurrence of default and the debt amount were substantiated with evidence, including acknowledgment by the Corporate Debtor and financial records. The Respondent admitted the default in its reply. The application was found to be complete, and no disciplinary proceedings were pending against the proposed Resolution Professional. Issue 4: Appointment of Interim Resolution Professional: The Tribunal appointed the new Interim Resolution Professional, directing him to fulfill the obligations under the Insolvency and Bankruptcy Code, specifically Sections 15, 17, 18, 20, and 21. Issue 5: Admission of the Petition and Declaration of Moratorium: The petition was admitted based on the established default in payment exceeding the threshold limit. Consequently, a moratorium was declared under Section 14 of the Code, imposing restrictions on legal actions against the Corporate Debtor. Issue 6: Directions Regarding Committee of Creditors and Progress Reports: The Interim Resolution Professional was tasked with forming a Committee of Creditors, submitting progress reports, and convening meetings as per the Code's requirements. The Financial Creditor was instructed to deposit a specified amount for the Interim Resolution Professional's expenses. Issue 7: Financial Deposit by the Financial Creditor for Expenses: The Financial Creditor was directed to deposit a sum with the Interim Resolution Professional to cover expenses related to the resolution process, subject to adjustment by the Committee of Creditors upon conclusion of the process. The Tribunal communicated the order to the parties involved, emphasizing compliance with the directives. The judgment addressed various legal aspects, ensuring due process and adherence to the provisions of the Insolvency and Bankruptcy Code.
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