2022 (10) TMI 809 - Tri - Insolvency and Bankruptcy

Maintainability of petition - 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 demand notice - whether the demand notice dated 16.06.2019 was properly served? - HELD THAT - The demand notice sent at registered address of the respondent/corporate debtor, as available on the master data of the corporate debtor, was delivered and tracking report showing its delivery has also been annexed with the petition. Whether the operational debt was disputed by the corporate debtor? - HELD THAT - The petitioner/operational creditor has filed an affidavit dated 16.08.2019 (Annexure A-7) under Section 9(3)(b) of the Code, wherein it has been deposed that till the filing of the present petition there is no dispute communicated by the respondent/corporate debtor for the unpaid debt and no payment has been received during this period. Further, it has been deposed that no reply has been received to the demand notice within the stipulated 10 days time from the receipt of demand notice and that there is no preexisting dispute between the parties at all with regard to the unpaid operational debt. Whether this application was filed within limitation? - HELD THAT - A perusal of the case file shows that the application was filed vide Diary No. 4108 dated 16.08.2019, whereas the date of default is 09.12.2018 i.e. 7 days from the date of invoice as per the agreed terms, as is mentioned in Part-IV of Form 5. Therefore, this Adjudicating Authority finds that this application has been filed within limitation. There is a total unpaid operational debt of Rs. 7,54,509/-, as claimed in the petition. As noted above, the operational creditor has provided the details of the debt due and has also annexed with the petition copy of ledger account statement, and invoices. Accordingly, the petitioner/operational creditor has established the debt and the default, which is more than Rupees one lakh i.e. the threshold limit (pre-revised) - all the requirements have been satisfied. It is seen that the petition preferred by the petitioner is complete in all respects. The material on record 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 for initiation of the CIRP in the case of the corporate debtor, Vishal Rice Exports Private Limited is admitted. Petition admitted - moratorium declared.

Summary

Issues Involved:
1. Proper service of the demand notice.
2. Dispute regarding the operational debt.
3. Filing of the application within the limitation period.
4. Completeness of the application.
5. Admission of the Corporate Insolvency Resolution Process (CIRP).
6. Appointment of Interim Resolution Professional (IRP).
7. Directions for moratorium.

Detailed Analysis:

1. Proper Service of the Demand Notice:
The first issue considered was whether the demand notice dated 16.06.2019 was properly served. The tribunal confirmed that the demand notice sent to the registered address of the corporate debtor was delivered, as evidenced by the tracking report annexed with the petition.

2. Dispute Regarding the Operational Debt:
The tribunal examined whether the operational debt was disputed by the corporate debtor. The operational creditor filed an affidavit under Section 9(3)(b) of the Insolvency and Bankruptcy Code, 2016, stating that no dispute was communicated by the corporate debtor regarding the unpaid debt, nor was any payment received. Additionally, no reply to the demand notice was received within the stipulated 10 days, and there was no preexisting dispute between the parties concerning the unpaid operational debt.

3. Filing of the Application Within the Limitation Period:
The tribunal assessed whether the application was filed within the limitation period. The application was filed on 16.08.2019, whereas the date of default was 09.12.2018, which is within the limitation period as per the agreed terms. Therefore, the tribunal found the application to be filed within the limitation period.

4. Completeness of the Application:
The tribunal reviewed the contents of the application filed in Form 5 and found it to be complete. The operational creditor provided details of the debt due, including copies of the ledger account statement and invoices, establishing the debt and default, which exceeded the threshold limit of Rupees one lakh (pre-revised).

5. Admission of the Corporate Insolvency Resolution Process (CIRP):
The tribunal noted that the corporate debtor failed to make the payment of the claimed amount even after the demand notice. The conditions under Section 9 of the Code were satisfied, and the liability of the corporate debtor was undisputed and admitted. Consequently, the tribunal admitted the petition for initiating the CIRP against the corporate debtor.

6. Appointment of Interim Resolution Professional (IRP):
Initially, Mr. Vikas Garg was proposed as the IRP. However, due to disciplinary proceedings against him, the petitioner proposed a new IRP, Mr. Deepankur Sharma, whose credentials were verified and found satisfactory. The tribunal appointed Mr. Deepankur Sharma as the IRP with specific directions, including taking control and custody of the corporate debtor's assets and managing the affairs as per the Code's provisions.

7. Directions for Moratorium:
The tribunal directed a moratorium in terms of Section 14(1) of the Code, which included:
- Suspension of suits or proceedings against the corporate debtor.
- Prohibition on transferring or disposing of the corporate debtor's assets.
- Prohibition on actions to foreclose or enforce security interests.
- Prohibition on recovery of property occupied by the corporate debtor.

The moratorium would remain effective until the completion of the CIRP or until a resolution plan is approved or an order for liquidation is passed.

Conclusion:
The tribunal allowed and admitted the petition for CIRP, directed the petitioner to deposit Rs. 50,000 with the IRP for immediate CIRP expenses, and communicated the order to both parties and the IRP.