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2022 (1) TMI 261 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT - It is seen from the submissions that, the Principal amount claimed by the Applicant is ₹ 1.25 Crore, which is deposited with the Corporate Debtor for the supply of goods to the Applicant. While this being the fact, it is pertinent to decide under the provisions of IBC, 2016, on the issue, as to whether the Petitioner qualifies to be an Operational Creditor in relation to the Corporate Debtor. For a person to qualify as an Operational Creditor he must have supplied the goods or rendered service to the Corporate Debtor, which is not the proposition in the present case and on the other, as per the agreement dated 01.12.2016 filed by the Applicant, it is the Corporate Debtor who is required to supply the goods to the Applicant, claiming to be Operational Creditor. Further, the default in the present case has arisen since the Corporate Debtor had failed to repay the deposit which is made by the Applicant - Thus, the failure to repay the deposit amount would not fall within the meaning of operational debt as stipulated under Section 5(21) of IBC, 2016 and as a consequent thereto, the Petitioner does not qualify to be an Operational Creditor as defined under Section 5(20) of IBC, 2016 in respect of the Corporate Debtor. The instant Application filed by the Applicant under Section 9 of IBC, 2016 is not maintainable - Application dismissed.
Issues:
Adjudication of an application filed under Section 9 of the Insolvency & Bankruptcy Code 2016 for initiating Corporate Insolvency Resolution Process against a Corporate Debtor. Detailed Analysis: Issue 1: Admissibility of the Application The application was filed by an Operational Creditor against a Corporate Debtor seeking admission, initiation of Corporate Insolvency Resolution Process, declaration of moratorium, and appointment of an Interim Resolution Professional. Issue 2: Details of the Application The application outlined the Operational Creditor, Corporate Debtor, outstanding debt amount, default period, particulars of operational debt, and evidence of default. Issue 3: Submission by Operational Creditor Operational Creditor claimed to have deposited a substantial amount with the Corporate Debtor for business purposes, highlighting defaults and assurances made by the Corporate Debtor. Issue 4: Counter by Corporate Debtor Corporate Debtor contested the claim, stating that no goods or services were supplied by the Operational Creditor, and the claim did not qualify as operational debt under the Insolvency & Bankruptcy Code. Issue 5: Judicial Analysis The Tribunal analyzed the definitions of claim, debt, default, operational creditor, and operational debt under the Insolvency & Bankruptcy Code to determine the eligibility of the Operational Creditor. Issue 6: Qualification as Operational Creditor The Tribunal noted that for a debt to be considered operational, it must meet specific criteria, including being owed by the Corporate Debtor to the Creditor who supplied goods or services, which was not the case in this instance. Issue 7: Decision Based on the analysis, the Tribunal concluded that the application was not maintainable as the Operational Creditor did not meet the requirements to be classified as an Operational Creditor under the Insolvency & Bankruptcy Code. Consequently, the application was dismissed with no costs awarded. This detailed analysis of the judgment highlights the key issues, submissions, legal interpretations, and the final decision reached by the Tribunal regarding the admissibility of the application under the Insolvency & Bankruptcy framework.
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