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2024 (10) TMI 574 - AT - IBC


Issues Involved:

1. Incorrect Date of Default
2. Determination of Default Date
3. Improper Basis for Default
4. Acknowledgment of Debt
5. Barred by Limitation
6. Compliance with Circular
7. Clause 7 Interpretation
8. Lack of Evidence
9. Service of Petition
10. Malicious Intent
11. Hon'ble Supreme Court Precedents

Issue-wise Detailed Analysis:

1. Incorrect Date of Default:
The Appellant contended that the date of default should be the date of non-payment under the restructured plan, not before. The Tribunal found that the restructuring plan acknowledged the debt, thus extending the limitation period. The default date of 30.04.2018 was not barred by limitation due to the acknowledgment of debt on 27.03.2021.

2. Determination of Default Date:
The Appellant argued that the Adjudicating Authority cannot determine a default date different from that stated in the Petition. The Tribunal upheld the NCLT's finding that the restructuring acknowledgment extended the limitation period, making the Petition timely.

3. Improper Basis for Default:
The Appellant claimed that the basis for default, being the NPA classification, was incorrect post-restructuring. The Tribunal found that the restructuring plan's revocation clause legally reinstated the original liability upon default, justifying the CIRP initiation.

4. Acknowledgment of Debt:
The Appellant disputed that part payments extended the limitation period. The Tribunal held that the acknowledgment of debt in the restructuring plan extended the limitation, supporting the Petition's timeliness.

5. Barred by Limitation:
The Appellant argued the claim was time-barred, with the default date being 30.04.2018. The Tribunal concluded that the restructuring acknowledgment extended the limitation, and the Supreme Court's exclusion of the limitation period due to COVID-19 further supported the Petition's timeliness.

6. Compliance with Circular:
The Appellant alleged non-compliance with the Master Circular on Asset Reconstruction Companies. The Tribunal found no concrete evidence to support this claim, dismissing it as unsubstantiated.

7. Clause 7 Interpretation:
The Appellant contended that reliance on Clause 7 for default determination was misplaced. The Tribunal upheld the Financial Creditor's legal right to revoke restructuring upon default, as explicitly provided in Clause 7.

8. Lack of Evidence:
The Appellant claimed a lack of evidence for the default date. The Tribunal found sufficient documentary evidence supporting the Financial Creditor's claims, dismissing this contention.

9. Service of Petition:
The Appellant argued non-compliance with Rule 4(3) regarding service of the Petition. The Tribunal did not find this argument substantiated with evidence, dismissing it.

10. Malicious Intent:
The Appellant alleged the Petition was filed with malicious intent. The Tribunal found the CIRP initiation justified by the Corporate Debtor's default, rejecting claims of malicious intent.

11. Hon'ble Supreme Court Precedents:
The Appellant cited Supreme Court precedents to argue against the CIRP initiation. The Tribunal clarified that the cited judgments did not support the Appellant's case, affirming the NCLT's decision to proceed with the CIRP.

Conclusion:
The Tribunal upheld the NCLT's Impugned Order dated 27.10.2023, admitting Company Petition No. 9 of 2023 and initiating CIRP against the Corporate Debtor, Vilson Roofing Product Pvt. Ltd. The Appeal was dismissed, and the CIRP was directed to continue as per the Impugned Order, with the Interim Resolution Professional proceeding in accordance with the Insolvency and Bankruptcy Code, 2016.

 

 

 

 

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