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2022 (9) TMI 629 - Tri - Insolvency and BankruptcyMaintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - time limitation - authority of the Assistant General Manager - HELD THAT - It is evident that the said Company Petition has been filed on the basis of a letter of authority of the Assistant General Manager (Administration), State Bank of India, to Sri Sourav Kumar Sharma. The said Sri Sourav Kumar Sharma is an Assistant General Manager of the rank of a Scale V Officer of the State Bank of India - In terms of the Gazette Notification of the Government of India published on 2nd May 1987 all officers of State Bank of India of a grade of SMGC-IV and above are empowered to sign all documents, accounts, receipts, letters etc. In the circumstances, the CP has been affirmed by an authorized and competent officer of the State Bank of India. Existence of debt and dispute or not - HELD THAT - It is found on the basis of record that the Corporate Debtor has in clear terms acknowledged its debt in its balance sheets from the year ending 31st March, 2018 and 31st March, 2019 which are at page 531, 532 and 613 of the petition under section 7 of the Code. Time Limitation - HELD THAT - The payment was made within the period of three years from the date of NPA i.e. on 05.08.2013 and when this payment was made on 07.06.2016, a fresh period of limitation under Section 19 of the Limitation Act, 1963 commenced. There is clear acknowledgement of debt by the Corporate Debtor in its balance sheets mentioned above for the year ended 31st March, 2018 and 31st March, 2019. Present petition has been filed on 24.03.2021, therefore the same in within the limitation period. The Corporate Debtor for One Time Settlement. This in itself is an admission of having availed the loan facilities from the applicant Bank and also the default to repay the same - The amount in default is over and above the threshold limit of Rs. One Crore and thus this application is maintainable before this Adjudicating Authority. Application admitted - moratorium declared.
Issues Involved:
1. Authority of the Assistant General Manager to file the petition. 2. Acknowledgement of debt and default by the Corporate Debtor. 3. Limitation period for filing the application. 4. Admission of the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016. 5. Declaration of moratorium and appointment of Interim Resolution Professional (IRP). Detailed Analysis: 1. Authority of the Assistant General Manager to file the petition: The petition was filed by the Assistant General Manager (AGM) of State Bank of India, Mr. Sourav Kumar Sharma, authorized by a letter dated 31.12.2020. The Corporate Debtor questioned the authority of the AGM to file the petition. The Tribunal found that the AGM was authorized by the Chairman of State Bank of India under Section 27 of the State Bank of India Act, 1955, and the Gazette Notification of the Government of India published on 2nd May 1987, which empowered officers of a grade of SMGC-IV and above to sign documents. Hence, the petition was affirmed by an authorized and competent officer of the State Bank of India. 2. Acknowledgement of debt and default by the Corporate Debtor: The Financial Creditor provided various documents, including balance sheets for the years ending 31st March 2018 and 31st March 2019, which acknowledged the debt. The Corporate Debtor denied the allegations but had previously made payments within the limitation period and acknowledged the debt in its balance sheets. The Tribunal referenced the case of Asset Reconstruction Company (India) Ltd. vs. Bishal Jaiswal and Another (2021 SCC Online SC 321) to support that entries in the balance sheets can amount to an acknowledgment of liability under Section 18 of the Limitation Act, 1963. 3. Limitation period for filing the application: The Corporate Debtor argued that the application was time-barred, as the account was declared NPA on 5th August 2013, and the application was filed in 2021. The Tribunal noted that the Corporate Debtor made a payment on 6th June 2016, within three years from the date of NPA, which restarted the limitation period under Section 19 of the Limitation Act, 1963. The fresh period of limitation commenced from the date of payment, and the petition filed on 24.03.2021 was within the limitation period. 4. Admission of the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016: The Tribunal found sufficient evidence of debt and default by the Corporate Debtor, including various documents and acknowledgments in balance sheets. The amount in default was above the threshold limit of Rs. One Crore. Therefore, the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, was admitted. 5. Declaration of moratorium and appointment of Interim Resolution Professional (IRP): The Tribunal declared a moratorium under Sections 13 and 15 of the Insolvency and Bankruptcy Code, 2016, prohibiting the institution of suits, transferring of assets, and recovery actions against the Corporate Debtor. Mr. Yogesh Gupta was appointed as the Interim Resolution Professional (IRP) to ascertain the particulars of creditors and convene a Committee of Creditors for evolving a resolution plan. The Financial Creditor was directed to deposit Rs. 3,00,000/- with the IRP within three days from the order. Order: The application filed by the Financial Creditor under Section 7 of the Insolvency & Bankruptcy Code, 2016, for initiating Corporate Insolvency Resolution Process against the Corporate Debtor was admitted. The Tribunal declared a moratorium, appointed an IRP, and directed the Financial Creditor to deposit preliminary expenses. The matter was listed for a progress report on 31 October 2022. Certified copies of the order were to be issued to all concerned parties. The order was signed on 12th September 2022.
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