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2020 (10) TMI 60 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - HELD THAT - The Financial Creditor has succeeded in proving that the debt is due and payable and the Corporate Debtor has failed to prove that the debt claimed by the Financial Creditor is not due and payable under any law or under any facts. The application is otherwise complete. All the requirements to be meted out under Section 7(3) of the Code seen produced in the case in hand - The Financial Creditor being succeeded in proving that all the requirements to be meted out under Section 7(3) of the Insolvency Bankruptcy Code, 2016 has been meted out and that the claim of the Financial Creditor is not barred by law of limitation and that the debt is due and payable by the Corporate Debtor not been paid by the Corporate Debtor, this application is liable to be admitted. Application admitted - moratorium declared.
Issues:
1. Application under Section 7 of the Insolvency & Bankruptcy Code for initiating Corporate Insolvency Resolution Process. 2. Allegation of default in loan repayment by the Corporate Debtor. 3. Objection by the Corporate Debtor regarding the debt claim and default. 4. Evidence presented by the Financial Creditor to prove default and non-repayment. 5. Arguments regarding the period of limitation for filing the application. 6. Examination of evidence and legal precedents related to the default date. 7. Decision on the admission of the application and appointment of an Insolvency Professional. Analysis: 1. The Financial Creditor filed an application under Section 7 of the Insolvency & Bankruptcy Code against the Corporate Debtor for defaulting on loans amounting to ?988.75 lakh. The Corporate Debtor contested the claim, arguing against the alleged default and debt repayment terms. 2. The Financial Creditor supported its claim with loan agreements and default notices, asserting that the Corporate Debtor failed to repay despite demands. The Corporate Debtor disputed the default date and the validity of interest charges, seeking dismissal of the application. 3. The Financial Creditor refuted the Corporate Debtor's objections, citing acknowledgments of debt in the Corporate Debtor's financial statements. The Corporate Debtor referenced legal judgments on the limitation period for such applications, challenging the timing of the default. 4. After reviewing the evidence, including loan documents and financial records, the Tribunal found sufficient proof of the Corporate Debtor's default on the loans. The Financial Creditor's submission of a report further strengthened the case for default on 30.06.2016. 5. The Corporate Debtor's argument on the limitation period was countered by the Financial Creditor's evidence and legal interpretations. The Tribunal upheld the Financial Creditor's position that the debt was due and payable, dismissing the Corporate Debtor's contentions. 6. The Tribunal admitted the application, declaring a moratorium under Section 14 of the Code and appointing an Interim Resolution Professional. The orders included instructions for creditor meetings, resolution plan submission, and communication of the decision to all parties involved. 7. The detailed analysis of the evidence, legal arguments, and precedents led to the Tribunal's decision to admit the application and proceed with the Corporate Insolvency Resolution Process, ensuring compliance with the Code's provisions and procedural requirements.
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