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TMI Blog2019 (6) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... admission of this application under Section 7 of the Code. The expression 'immediately' means within three days as clarified by Explanation to Regulation 6 (1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. Application admitted - moratorium declared. - CP NO. IB-759(PB)/2018 - - - Dated:- 8-4-2019 - MR (RTD.) M. M. KUMAR, PRESIDENT AND DR. DEEPTI MUKESH, MEMBER (J) For The Petitioner : Mr Kapil Madan And Amit Kimothi, Advocates For The Respondent : Mr Sangram Patnaik And Ms. Rukmini Mukherjee, Advocates JUDGMENT M. M. KUMAR, PRESIDENT The 'Financial Creditor'-IVL Finance Limited has filed the instant application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for brevity 'the Code') with a prayer to trigger the Corporate Insolvency Resolution Process in the matter of Income Cables Private Limited. 2. Mr. Vipin Saroha, Legal Head of the petitioner has been authorized by the Board Resolution dated 14.09.2018 (at pg. 62) to sign and submit the petition. 3. The Corporate Debtor- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .. (f) .. (g) .. (h) .. (i) .. 12.2 On and at any time after the occurrence of an Event of Default, Lender may, with or without any notice to any of the Obligor(s) and with or without the intervention of the court/arbitrator (i) cancel/recall the Loan whereupon the Borrower's Dues shall become immediately repayable/payable by the Obligor(s); and/or (ii) initiative/exercise any or all of its rights, actions, remedies and powers under the Loan Documents and/or applicable laws (including issuance of show-cause notice(s) to the Obligor(s) and for making submissions before the relevant committee of the Lender)., and/or (iii) enforce, sell, invoke, deliver, deal with, take possession, convey, transfer, assign, lease, sub-lease, encumber and/or dispose of in any manner. .. 6. As per the terms agreed between the parties the loan was to be repaid in 36 equal monthly instalments alongwith interest @ 19% per annum. It has been submitted by the Financial Creditor that the 'Corporate Debtor' failed to make payment of the EMIs on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner is still accepting deposits from the Respondent as lately as on 21.08.2018. (v) In the year 2017 the Respondent had in fact approached the petitioner to settle the entire arrangement in one go however the petitioner refused to settle the said arrangement dated 31.07.2018 on account of loss of petitioner's interest. (vi) The petitioner is an unsecured creditor who has already initiated arbitration proceeding which are pending before the Ld. Sole Arbitrator. The present proceedings have clearly been filed as an afterthought though Respondent has been regularly appearing and have raised bona fide disputes before the Arbitrator. The petitioner cannot be permitted to pursue two parallel proceedings which in otherwise filed in order to harass and heckle the Respondent. 11. A rejoinder to the reply has been filed by the Financial Creditor reiterating the submissions made in the application and controverting the assertions raised in the reply. In para 4 of the rejoinder it has been submitted that since the Respondent was continually defaulting even after issuance of loan recall notice on 22.03.2018, the petitioner was well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned in the application along with other crucial documents. In the present case, it has come on record predominantly that the 'default' has occurred many a times. 14. Another objection raised by the Corporate Debtor is that there is a mismatch/variation in the amount of claim in the recall notice and the notice sent under the Code. In that regard learned counsel for the Financial Creditor has placed reliance on the observations made by this Bench in para 14 of the judgment rendered in the case of Bank, of India v. Tirupati Infraprojects Pvt. Ltd. C.P. No. (IB)-104(PB)/2017 decided 03.07.2017.. This Bench has observed that if there was any discrepancy in calculation then it does not materially affect the admission of such application and that the Adjudicating Authority is not entrusted with any function to determine the amount of default; and once the default has occurred involving rupees one lakh or more in terms of Section 4 of IBC then one of the requirements for initiating the insolvency process stand satisfied. The objection of this nature concerning discrepancy in calculation of the amount would surely be maintainable before the Committee of Credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per the requirements of Section 7(2) of the Code and other conditions prescribed by Rule 4(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. There is overwhelming evidence to prove default and name of the resolution professional has also been clearly specified. 18. The provisions of Section 7(2) and Section 7(5) of IBC stand satisfied but the same may be read as under:- Initiation of corporate insolvency resolution process by financial creditor. 7(1) . 7(2) The financial creditor shall make an application under sub-section (1) in such form and manner and accompanied with such fee as may be prescribed. 7(3) . 7(4) . 7(5) Where the Adjudicating Authority is satisfied that- (a) a default has occurred and the application under sub-section (2) is complete, and there is no disciplinary proceedings pending against the proposed resolution professional, it may, by order, admit such application; or (b) . 19. A conjoint reading of the aforesaid provision would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. 23. It is made clear that the provisions of moratorium shall not apply to (a) such transactions which might be notified by the Central Government in consultation with any financial regulator; (b) a surety in a contract of guarantor to a Corporate Debtor. Additionally, the supply of essential goods or services to the Corporate Debtor as may be specified is not to be terminated or suspended or interrupted during the moratorium period. These would include supply of water, electricity and similar other services or supplies as provided by Regulation 32 of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 24. We direct the Financial Creditor to deposit a sum of ₹ 2 lacs with the Interim Resolution Professional to meet out the expenses to perform the functions assigned to him in accordance with Regulation 6 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Person) Regulations, 2016. The needful shall be done within three days from the date of receipt of this order by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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