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2022 (7) TMI 771 - 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and dispute or not - HELD THAT - It is seen from the records that the Company Petition 2430/2018 was disposed of as withdrawn vide Order dated 30.04.2019 in view of the settlement terms as entered between the parties. The said Order also granted liberty to the Operational Creditor to mention the said CP in case of breach of the settlement terms. Further the Operational Creditor had sent demand notice dated 25.05.2018 under section 8 of the Code for unpaid amount of Rs. 32,72,03,256/-. The Corporate Debtor further in its written submissions dated 24.03.2022 have raised an issue that rental dues or dues under a leave and license agreement cannot be considered as an operational debt. In view of the above facts and circumstances and breach of the settlement agreement by the Corporate Debtor further the existence of debt and default has been proved by the Operational Creditor and at the very outset the Corporate Debtor has accepted it s liability in view of its Settlement Agreement thereby acknowledging its liability which is due and payable against the facilities extended by the Operational Creditor - Further the Corporate Debtor has also nothing stated on the merits of the case nor has denied the liability accrued with regards to the facilities extended. Hence it is clear that the liability to repay falls on the Corporate Debtor. The Company Petition is liable to be admitted - Moratorium declared.
Issues Involved:
Admission of Company Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 against default of principal amount and interest due to breach of consent terms between parties. Detailed Analysis: 1. The Interlocutory Application sought admission of the Company Petition by the Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code against a default amount. The parties had previously agreed to settle the claim for Rs. 20 Crores in monthly installments, but the Corporate Debtor breached the consent terms, leading to the filing of the present application. 2. The Tribunal had disposed of a previous Company Petition with liberty for the Operational Creditor to approach in case of settlement term breach. The Operational Creditor filed a subsequent application seeking revival of the Company Petition, which led to stern observations against the Corporate Debtor for default in payment as agreed upon. 3. Despite executing a second terms of settlement, the Corporate Debtor failed to make payments and argued that the application was infructuous. The Corporate Debtor's attempt to avoid liability by stating the application was not maintainable due to the settlement terms was rejected. 4. The Tribunal found that the Corporate Debtor breached the settlement agreement, proving the existence of debt and default. The Corporate Debtor accepted its liability in the settlement agreement, acknowledging the amount due and payable to the Operational Creditor. 5. The Corporate Debtor did not contest the merits of the case or deny the liability accrued from the facilities extended. Therefore, the Tribunal concluded that the liability to repay falls on the Corporate Debtor, leading to the admission of the Company Petition and initiation of Corporate Insolvency Resolution Process against the Corporate Debtor. 6. The Tribunal admitted the Company Petition, allowed and disposed of related applications, appointed an Interim Resolution Professional, directed the Operational Creditor to deposit CIRP costs, imposed a moratorium on suits and proceedings against the Corporate Debtor, and specified various provisions to be followed during the insolvency resolution process. 7. The Tribunal's order included directions regarding the management of the Corporate Debtor during the CIRP period, communication of the order to relevant authorities, and updating of corporate data with the Registrar of Companies. Conclusion: The Tribunal admitted the Company Petition, initiating the Corporate Insolvency Resolution Process against the Corporate Debtor due to breach of settlement terms and default in payment, establishing the liability of the Corporate Debtor to repay the outstanding amount to the Operational Creditor.
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