2020 (10) TMI 62 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of Operational debt and dispute or not - HELD THAT - Date of invoice is from 16.12.2014 to 29.04.2015. Date of first default is 26.06.2015 - Application is filed within the limitation period as the date of default is 26.06.2015 and the date of filing this petition under Section 9 of IBC is 26.06.2018. the last payment received from the corporate debtor was on 28.11.2017 for INR. 1,99,996.46. This Adjudicating Authority is satisfied that, a) Existence of operational debt is above Rs. One Lac; b) Debt is due; c) Default has occurred on 26.06.2015 Petition has been filed within the limitation period as the date of default started 26.06.2015 and the petition has been filed on 26.06.2018 and the last payment received from the corporate debtor was on 28.11.2017 for INR. 1,99,996.46.00 d) Existence of dispute prior to the notice issued by the Operational Creditor is not found. Application admitted - moratorium declared.

Summary

Issues Involved:
1. Initiation of Corporate Insolvency Resolution Process (CIRP)
2. Existence and amount of operational debt
3. Default and limitation period
4. Pre-existing dispute
5. Appointment of Interim Resolution Professional (IRP)
6. Declaration of moratorium

Detailed Analysis:

1. Initiation of Corporate Insolvency Resolution Process (CIRP):
The petition was filed by the Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of CIRP against the Corporate Debtor. The Operational Creditor supplied Steam Coal to the Corporate Debtor, who defaulted on payments amounting to INR 87,23,817 along with interest at 18% per annum.

2. Existence and Amount of Operational Debt:
The Operational Creditor provided detailed invoices and ledger accounts showing that the Corporate Debtor was indebted for INR 87,23,817. The invoices were raised between 26.06.2015 and 28.11.2017, and the amounts remained unpaid. The tribunal found that the existence of operational debt above INR 1 lakh was established.

3. Default and Limitation Period:
The first default occurred on 26.06.2015, and the petition was filed on 26.06.2018, within the three-year limitation period. The last payment from the Corporate Debtor was received on 28.11.2017. The tribunal confirmed that the petition was filed within the limitation period.

4. Pre-existing Dispute:
The Corporate Debtor claimed a pre-existing dispute regarding the quality of coal supplied, supported by letters and debit notes. However, the tribunal found these documents to be fabricated and backdated, as there was no proof of dispatch or delivery. The tribunal concluded that there was no pre-existing dispute prior to the notice issued by the Operational Creditor.

5. Appointment of Interim Resolution Professional (IRP):
The Operational Creditor suggested the name of Kedar Laddha as the IRP. The tribunal appointed Mr. Kedar Laddha, having Insolvency Professional Registration Number IBBI/IPA-001/IP.P00586/2017-2018/11115, as the IRP. The IRP was directed to file a declaration disclosure statement within two days and make a public announcement of the moratorium.

6. Declaration of Moratorium:
The tribunal declared a moratorium prohibiting the institution or continuation of suits or proceedings against the Corporate Debtor, transferring or disposing of assets, and recovering property occupied by the Corporate Debtor. The moratorium would remain in effect until the completion of the CIRP.

Final Judgment:
The tribunal admitted the petition on 28.05.2020, initiating the CIRP against the Corporate Debtor with the above observations and directions. An authenticated copy of the order was to be communicated to the Operational Creditor, Corporate Debtor, IRP, and Registrar of Companies.