2022 (3) TMI 407 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditor - existence of debt and dispute or not - HELD THAT - It is the case of the applicant that the Corporate debtor had issued cheque towards the outstanding due payment which has been bounced and was returned bank unpaid by their Bank. Further, issuance of the cheque indicates admission of debt by the corporate debtor towards the applicant. This leaves no doubt that the default has occurred for the payment of the operational debt to the applicant - in the given facts and circumstances, it can be concluded that the applicant has established its claim which is due and payable by the corporate debtor. The present application is admitted. Application admitted - moratorium declared.

Summary

Issues:
Application for initiation of Corporate Insolvency Resolution Process (CIRP) under Section 9 of IBC 2016 based on alleged default by the Corporate Debtor in payment for printing inks supplied by the Operational Creditor.

Analysis:
The application was filed by the Operational Creditor, who is the sole proprietor of M/s. Gem International, seeking to initiate CIRP against the Corporate Debtor, M/s. Aar Vee Printers Private Limited, for an outstanding balance of ?6,16,972 on account of supplying printing inks. The Operational Creditor detailed the transactions, including raising twenty-two invoices between April 2013 to August 2014, with partial payments received and subsequent default by the Corporate Debtor. The Operational Creditor also highlighted a bounced cheque issued by the Corporate Debtor towards the outstanding payment, indicating admission of debt.

Despite opportunities provided, the Respondent (Corporate Debtor) did not file a reply, leading to an ex-parte proceeding. The Tribunal acknowledged the bounced cheque as evidence of the debt admission by the Corporate Debtor, establishing the default in payment of operational debt to the Operational Creditor. Consequently, the Tribunal admitted the application based on the established claim by the Operational Creditor.

The Tribunal appointed an Insolvency Resolution Professional (IRP), Mr. Hans Raj Bhogra, for the Corporate Debtor, subject to certain conditions. The Operational Creditor was directed to deposit ?2 lakhs with the IRP to cover expenses, with adjustments to be made by the Committee of Creditors. The moratorium under Section 14(1) of the Code was imposed on the Corporate Debtor upon admission of the application, with corresponding provisions from Section 14(2) to 14(4) coming into effect during the moratorium period.

The Registry was instructed to communicate the order to the parties involved, including the IRP, and forward a copy to IBBI for records. The Operational Creditor was directed to provide a complete paper book to the IRP, and the ROC was tasked with updating the Master Data and sending a compliance report to the Registrar, NCLT.