2022 (7) TMI 13 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - time limitation - service of notice - whether the demand notice in Form 3 dated 31.07.2018 was properly served? - HELD THAT - The service through publication has been done to that effect. Whether the operational debt was disputed by the corporate debtor? - HELD THAT - It is to be noted that none appeared on behalf of corporate debtor despite repeated service and has been set ex parte vide order dated 09.08.2021. Moreover, petitioner has appended affidavit u/s 9(3)(b) stating that corporate debtor has not issued any notice or raised any dispute regarding the debt for which the present petition has been filed by the operational creditor. Whether this application is filed within limitation? - HELD THAT - This application was filed on 23.01.2020 vide Diary No. 651 whereas the date of default is 21.01.2019, therefore, this Adjudicating Authority finds that this application has been filed within limitation. It is noted that the corporate debtor has failed to make payment of the aforesaid amount due as mentioned in the statutory notice till date. Thus, the conditions under Section 9 of the Code stand satisfied. It is evident that the liability of the corporate debtor is undisputed. Accordingly, the petitioner proved the debt and the default, which is above threshold limit. In the present petition all the aforesaid requirements have been satisfied. It is seen that the petition preferred by petitioner is complete in all respect. The material on record which remains unrebutted clearly goes to show that the respondent committed default in payment of the claimed operational debt even after demand made by the petitioner. In view of the satisfaction of the conditions provided for in Section 9(5)(i) of the Code, the petition deserves to be admitted. Petition admitted - moratorium declared.

Issues Involved:
1. Validity of demand notice served to the corporate debtor
2. Dispute regarding the operational debt by the corporate debtor
3. Timeliness of the application filed
4. Satisfaction of conditions under Section 9 of the Insolvency and Bankruptcy Code
5. Appointment of Interim Resolution Professional
6. Directions for moratorium and management of corporate debtor's affairs
7. Deposit for immediate expenses of the Corporate Insolvency Resolution Process (CIRP)

Detailed Analysis:

1. Validity of Demand Notice:
The Tribunal considered whether the demand notice in Form 3 dated 31.07.2018 was properly served. The service through publication was done, and it was noted that the operational debtor did not appear despite repeated service, leading to the respondent being set ex parte.

2. Dispute Regarding Operational Debt:
The issue of whether the operational debt was disputed by the corporate debtor was examined. It was highlighted that the corporate debtor did not appear despite repeated service and was set ex parte. The petitioner affirmed that the corporate debtor did not issue any notice or raise any dispute regarding the debt, supporting the initiation of the petition.

3. Timeliness of Application:
The Tribunal reviewed whether the application was filed within the limitation period. The application was filed on 23.01.2020, whereas the default date was 21.01.2019, indicating that the application was timely filed within the limitation period.

4. Satisfaction of Conditions under Section 9:
The Tribunal assessed the satisfaction of conditions under Section 9 of the Code. It was established that the petitioner proved the debt and default, exceeding the threshold limit, leading to the admission of the petition for the initiation of the Corporate Insolvency Resolution Process.

5. Appointment of Interim Resolution Professional:
Ms. Shilpa Singhal was appointed as the Interim Resolution Professional, with specific directions regarding her term of appointment, responsibilities, and filing requirements. The powers of the Board of Directors were suspended, and management vested in the Interim Resolution Professional.

6. Moratorium and Management of Affairs:
The Tribunal directed a moratorium on certain actions, including suits against the corporate debtor and asset disposal, with provisions for essential goods or services supply. The Interim Resolution Professional was tasked with managing the affairs of the corporate debtor and preparing an inventory of assets.

7. Deposit for Immediate Expenses:
The petitioner was instructed to deposit a specified amount with the Interim Resolution Professional to cover immediate expenses of the CIRP. This amount would be reimbursed by the Committee of Creditors and recovered as part of the CIRP costs.

This comprehensive analysis covers the key issues addressed in the judgment delivered by the National Company Law Tribunal, Chandigarh Bench.

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