9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (5) TMI 110 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - Financial Creditors - Existence of debt and dispute or not - HELD THAT - The Corporate Debtor in its reply raised defects regarding the Authorization letter, jurisdiction of the Hon'ble Tribunal and Computation of the Default amount which the financial Creditor vide its reply affidavit dated 16.02.2021 has replied to all the objections raised. Mere plain reading of the provision under section 7 of IBC shows that in order to initiate CIRP Under Section 7 the applicant is required to establish that there is a financial debt and that a default has been committed in respect of that financial debt. That while dealing with the said matter the Financial creditor has clearly established that a financial debt in form of Channel finance Loan has been advanced to the Corporate Debtor which can be clearly substantiated by the Confirmation of balance letter dated 18.09.2017 wherein, the Corporate Debtor confirmed the remaining balance of the said loan to the Financial Creditor. The Tribunal on a keen examination of the application and perusal of the documents submitted by both the parties can clearly substantiate that the attached receipts issued by the Financial Creditor indicating repayment of ₹ 3 Crore are towards the Hindalco account as dealer code HIN0001 has been clearly stated on the attached receipts. Whereas, no receipt regarding payment towards Vedanta account has been annexed by the Corporate Debtor. The documents submitted by the Financial Creditor and the Corporate Debtor clearly substantiate the Financial Creditor's claim that the Corporate Debtor has defaulted on repayment of loan amount - this tribunal after giving careful consideration to the entire matter, hearing the arguments of the parties and upon appreciation of the documents placed on record to substantiate the claim, this Tribunal admits this petition and initiates CIRP on the Corporate Debtor with immediate effect - Application admitted - moratorium declared.
Issues Involved:
1. Initiation of Corporate Insolvency Resolution Process (CIRP) 2. Authorization and maintainability of the application 3. Alleged repayment and default by the Corporate Debtor 4. Jurisdiction of the Tribunal 5. Computation of the default amount 6. Appointment of Interim Resolution Professional (IRP) Detailed Analysis: 1. Initiation of Corporate Insolvency Resolution Process (CIRP): The application was filed by Tata Capital Financial Services Limited to initiate CIRP against Kay Em Copper Private Limited under Section 7 of the Insolvency and Bankruptcy Code 2016 for an alleged default amounting to ?3,14,08,827/-. The applicant, a Non-Banking Financial Company registered with the Reserve Bank of India, provided a channel finance loan of ?3,00,00,000/- to the respondent for purchasing raw materials. The respondent allegedly defaulted on this loan. 2. Authorization and maintainability of the application: The respondent contested the application on the grounds that there was no proper authorization for filing the application. They argued that Mr. Sushant Sharma, who verified the application, was not adequately authorized by a board resolution. The Tribunal found that the board resolution dated 22.12.2017 authorized the MD and CEO to appoint persons holding specific designations, including that of Mr. Sushant Sharma, thus addressing the issue of authorization. 3. Alleged repayment and default by the Corporate Debtor: The respondent claimed that they had repaid the entire dues and that the reliance on the balance confirmation letter was misplaced. However, the Tribunal noted that the receipts provided by the respondent indicated payments towards the Hindalco account, not the Vedanta account, thereby substantiating the financial creditor’s claim of default. 4. Jurisdiction of the Tribunal: The respondent raised objections regarding the jurisdiction of the Tribunal. The Tribunal relied on precedents, including the NCLAT’s decisions in Mr. Satyaprakash Aggarwal and Ors. v. Vistar Metal Industries Limited and Binani Industries Limited v. Bank of Baroda, which clarified that the NCLT has jurisdiction over matters where the registered offices of the companies are situated, thus confirming its jurisdiction in this case. 5. Computation of the default amount: The respondent argued that the computation of the outstanding amount was not as per the Bankers’ Books Evidence Act, 1891. The financial creditor addressed this by providing the necessary documents and clarifications, including the missing pages from the initial application, thus rectifying the alleged defects. 6. Appointment of Interim Resolution Professional (IRP): The Tribunal appointed Mr. Dhiren Shantilal Shah as the Interim Resolution Professional to carry forward the CIRP. The IRP was directed to take necessary steps as required under the statute and file a report within 30 days. Conclusion: The Tribunal admitted the petition and initiated the CIRP against the Corporate Debtor. A moratorium was imposed as per Section 14 of the Code, restricting suits, asset transfers, and recovery actions against the respondent. The IRP was appointed to oversee the resolution process, marking the commencement of the CIRP with immediate effect.
|
