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2022 (1) TMI 976 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - settlement of dues by the Corporate Debtor - charge of Interest on Corporate Debtor - existence of debt and dispute or not - HELD THAT - The Bench observed that the Operational Creditor and Corporate Debtor had entered into the Settlement Deed for settlement of dues by the Corporate Debtor. The said Settlement Deed clearly shows the liability of Corporate Debtor to pay the outstanding. As per the terms of the Settlement Deed the payment was to be made from 15.06.2018 till 06.03.2019. The Corporate Debtor filed the Reply and denied the interest portion stating that there is no interest clause mentioned in the invoices raised on the Corporate Debtor. However, upon perusal of the records and documents filed by the Operational Creditor, the Purchase Order at p. 41 and the Invoices attached clearly show that interest is chargeable @ 21% p.a. after the due date of payment. Further, as per Settlement Deed dated 10.03.2019, both Operational Creditor and the Corporate Debtor have agreed for interest @ 18% p.a. for payment after due date. Hence, the Bench is of the considered view that the Operational Creditor is entitled to charge interest from Corporate Debtor. The Corporate Debtor is in default of a debt due and payable, and the default is in excess of minimum amount of One Crore rupees stipulated amendment made under section 4(1) of the IBC. Therefore, the default stands established and there is no reason to deny the admission of the Petition. Accordingly, this Adjudicating Authority admits the Petition and orders initiation of CIRP against the Corporate Debtor - Petition admitted - moratorium declared.
Issues:
1. Initiation of Corporate Insolvency Resolution Process under section 9 of the Insolvency & Bankruptcy Code, 2016 (IBC) against the Corporate Debtor. Analysis: 1. The Company Petition was filed seeking to initiate Corporate Insolvency Resolution Process against the Corporate Debtor due to non-payment of a substantial amount, including principal and interest. 2. The jurisdiction of the Tribunal was established as the Corporate Debtor was a Company incorporated under the Companies Act, 1956, with its registered office falling within the territorial jurisdiction of the Bench. 3. The Operational Creditor filed the petition based on the Corporate Debtor's failure to make payments as per the Purchase Orders, leading to a significant outstanding amount, as detailed in the petition. 4. The Operational Creditor's case included supplying materials, entering into a Settlement Deed for payment, and continued supply despite partial payments by the Corporate Debtor. 5. The Corporate Debtor admitted the liability for the supplied items but disputed the interest component, citing lack of an interest clause in the invoices. 6. The relevant dates of invoices, default, and settlement were crucial in determining the timeline and obligations of the parties involved. 7. The records, including Purchase Orders, Invoices, Demand Notice, Ledger Statement, and Affidavit, formed the basis of the Tribunal's findings. 8. The Bench analyzed the Settlement Deed, admissions, and relevant clauses to establish the liability of the Corporate Debtor and the entitlement of the Operational Creditor to claim interest. 9. The Tribunal found the Operational Creditor's petition complete, demonstrating the default in payment exceeding the minimum amount required under the IBC, leading to the admission of the petition. 10. The Tribunal admitted the petition, initiated the Corporate Insolvency Resolution Process, imposed a moratorium, appointed an Interim Resolution Professional, and outlined the necessary steps for the resolution process. 11. The order included provisions for the moratorium, management during the CIRP period, deposit by the Operational Creditor, communication of the order to relevant parties, and compliance reporting to the Registrar of Companies. This comprehensive analysis covers the key aspects of the judgment, including the background, arguments, findings, and the Tribunal's decision regarding the initiation of the Corporate Insolvency Resolution Process against the Corporate Debtor.
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