2022 (8) TMI 762 - 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 - Time Limitation - service of demand notice - whether the demand notice in Form 3 dated 10.01.2019 was properly served? - HELD THAT - The petitioner has filed its written submissions vide diary No. 00255/2 dated 05.07.2022, whereby it has been stated that the Demand notice as per Form 3 4 was duly served upon corporate debtor before filing of the present petition and no reply to that has been duly received. Whether the operational debt was disputed by the corporate debtor? - HELD THAT - It is to be noted that none appeared on behalf of the corporate debtor despite repeated service and has been set ex parte vide order dated 26.04.2022. Moreover, the petitioner has appended affidavit u/s. 9(3)(b) stating that even no reply to the demand notice and the corporate debtor has not cleared the outstanding dues, which is reflected in the certificate issued under Section 9(3)(c) of the Code, for which the present petition has been filed by the operational creditor. Whether this application is filed within limitation? - HELD THAT - This application was filed on 28.02.2019 vide Diary No. 1032. Whereas the date of default is 18.07.2018, therefore, this Adjudicating Authority finds that this application has been filed within limitation. There is a total unpaid operational debt (in default) is of Rs. 49,90,671/- (Principal amount of Rs. 45,30,671 plus interest at the rate of 12% p.a. from 14.03.2018 upto 10.01.2019). The operational creditor has supplied goods to the corporate debtor and raised invoices attached as Annexure A-3 to A7. Accordingly, the petitioner proved the debt and the default, which is more than Rupees one lakh (prior to the amendment in threshold limit of one crore vide notification No. S.O. 1205(E) dated 24.03.2020) by the respondent-corporate debtor - 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 above-mentioned facts that the liability of the corporate debtor is undisputed. Accordingly, the petitioner proved the debt and the default, which is above threshold limit. It is seen that the petition preferred by the petitioner is complete in all respects. 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 - Petition admitted - moratorium declared.

Issues Involved:
1. Initiation of Corporate Insolvency Resolution Process under Section 9 of the Insolvency and Bankruptcy Code, 2016.
2. Validity of demand notice served on the corporate debtor.
3. Disputed operational debt by the corporate debtor.
4. Timeliness of the application filed.
5. Completion and submission of required forms and documents.
6. Appointment of Interim Resolution Professional.
7. Imposition of moratorium and related directions.

Detailed Analysis:

1. Initiation of Corporate Insolvency Resolution Process:
The petition was filed by M/s. Madhav Alloys Private Limited, the operational creditor, seeking to initiate Corporate Insolvency Resolution Process against Aryan Villa and Resorts LLP, the corporate debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016. The petition detailed the outstanding operational debt, issuance of demand notice, and non-payment by the corporate debtor.

2. Validity of Demand Notice:
The petition included evidence of a demand notice served on the corporate debtor in Form 3 & 4 dated 10.01.2019, supported by postal receipts and an affidavit confirming no reply from the corporate debtor. The written submissions affirmed the proper service of the demand notice before filing the petition.

3. Disputed Operational Debt:
Despite repeated service and setting the corporate debtor ex parte, the operational debt was undisputed as per the petitioner's affidavit under Section 9(3)(b). The lack of response to the demand notice and non-clearance of dues further supported the claim of default by the corporate debtor.

4. Timeliness of Application:
The application was filed on 28.02.2019, within the limitation period from the date of default on 18.07.2018. The Adjudicating Authority found the application timely filed, meeting the requirements under the Code.

5. Completion of Forms and Documents:
The petition, including Form 5 and supporting annexures, demonstrated the completeness of the application. The operational creditor substantiated the unpaid operational debt, invoices, and interest calculations, fulfilling the threshold for initiating CIRP.

6. Appointment of Interim Resolution Professional:
In the absence of a proposed Interim Resolution Professional in Form 5, Mr. Vipul Garg was appointed as the Interim Resolution Professional from the IBBI list. The directions included filing consent, managing affairs, preparing asset inventory, and constituting a Committee of Creditors.

7. Imposition of Moratorium and Related Directions:
Upon admitting the petition and initiating CIRP, the Tribunal imposed a moratorium under Section 14 of the Code, restricting certain actions against the corporate debtor. Essential supplies were protected, and specific directions were given to the Interim Resolution Professional for managing the affairs of the corporate debtor.
This detailed analysis covers the key issues addressed in the judgment, outlining the legal proceedings and decisions made by the Tribunal in the context of initiating Corporate Insolvency Resolution Process and related matters.

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