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TMI Blog2022 (1) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... yable in law and has not been paid and a default has occurred, the Adjudicating Authority is to initiate CIRP if, he finds default recorded in the Information Utility or evidence of default. So, the criteria for initiation of the CIRP under the Code is limited to three things, (i) there is a debt due and payable in law and has not been paid (ii)Default has occurred (iii) Default is recorded with the Information Utility. Here all the three criteria s are met and hence initiation of CIRP by the Adjudicating Authority is in order. As far as issue of limitation is concerned the default has been committed on 03.09.2016 and the Application has been filed on 12.03.2019 hence, it is within a period of 3 years as required under Section 238A of the Code R/w 137 of the Limitation Act. Application allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 for the date of receipt of this order by the financial Creditor. The amount however be subject to adjustment by the Committee of Creditors as accounted for by Interim Resolution Professional and shall be paid back to the Financial Creditor. 19. As a consequence of the application being admitted in terms of Section 7(5) of IBC, 2016 moratorium as envisaged under the provisions of Section 14(1) shall follow in relation to the Corporate Debtor prohibiting proviso (a) to (d) of the Code. However, during the pendency of the moratorium period, terms of Section 14(2) to 14(4) of the Code shall come in vogue. 20. In terms of above order, the Application stands admitted in terms of Section 7(5) of IBC, 2016. A copy of the order shall be communicated to the Applicant as well as to the Corporate Debtor above named by the Registry. In addition, a copy of the order shall also be forwarded to IBBI for its records. Further the IRP above named be also furnished wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e account as NPA as per RBI guidelines and to act in accordance with law. In the peculiar facts and circumstances of the case, the parties are left to bear their own costs. File be consigned to records". 4. The Appellants have also pointed out that the impugned order failed to appreciate that with the date of NPA 02.12.2016 being prohibited and precluded from being treated as the date of "default", subsequent "defaults" were equally prohibited under the doctrine / principle of "Nullssuss Commodum Capere Postest De Injuria Sua Propria" that no man shall take advantage of its own wrong. The Hon'ble Supreme Court in (2017) 11 SCC 447, explaining the maxim held "It is settled principle of law that a man cannot be permitted to take undue and unfair advantage of his own wrong to gain favourable interpretation of law. It is sound principle that he who prevents a thing from being done shall not avail himself of the non-performance he has occasioned. To put it differently, "a wrongdoer ought not be permitted to make a profit out of his own wrong". The Appellants have accordingly submitted that such proceedings under the Code are without merit, jurisdiction and beyond the provisions of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Code and are having the following observations: a. It appears that the packing credit of ₹ 42 lakh was disbursed by the R1-Bank on 07.03.2016 and the due date of recoupment amount of that was 03.09.2016 but the Borrower i.e. the Appellants/CD (under CIRP) could not ship the goods and failed to adjust the packing credit/repayment thereof within 03.09.2016 and as a result of the 'RBI Guideline dated 01.07.2015', the account became NPA after 90 days i.e. 02.12.2016. b. As per the Application filed by PNB/Financial Creditor to initiate CIRP, in Part-IV, the following information has been provided: Particulars of Financial Debt 1. Total amount of Debt granted, date(s) of disbursement ₹ 30,75,00,000.00 Crore. That the CD was enjoying various credit facilities from Financial Creditor. These credit facilities were enhanced/ renewed/ reviewed from time to time Last Sanction on 11.03.2016 2. Amount claimed to be in default and the date on which default occurred (attach the workings for computation of amount and days of default in tabular form) Total amount claimed: ₹ 28,96,32,153.00 as on 31.01.2019. Date of default is 02.12.2016 i.e. the Date of NPA c. As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an allottee under a real estate project shall be deemed to be an amount having the commercial effect of a borrowing; and (ii) the expressions, "allottee" and "real estate project" shall have the meanings respectively assigned to them in clauses (d) and (zn) of section 2 of the Real Estate (Regulation and Development) Act, 2016 (16 of 2016); (g) any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price and for calculating the value of any derivative transaction, only the market value of such transaction shall be taken into account; (h) any counter-indemnity obligation in respect of a guarantee, indemnity, bond, documentary letter of credit or any other instrument issued by a bank or financial institution; (i) the amount of any liability in respect of any of the guarantee or indemnity for any of the items referred to in sub-clauses (a) to (h) of this clause; Section 7 - Initiation of corporate insolvency resolution process by financial creditor. (1) A financial creditor either by itself or jointly with [other financial creditors, or any other person on behalf of the financial creditor, as may be notified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall, within fourteen days of the receipt of the application under sub-section (2), ascertain the existence of a default from the records of an information utility or on the basis of other evidence furnished by the financial creditor under sub-section (3). [Provided that if the Adjudicating Authority has not ascertained the existence of default and passed an order under sub-section (5) within such time, it shall record its reasons in writing for the same.] (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) default has not occurred or the application under sub-section (2) is incomplete or any disciplinary proceeding is pending against the proposed resolution professional, it may, by order, reject such application: Provided that the Adjudicating Authority shall, before rejecting the application under clause (b) of sub-section (5), give a notice to the applicant to rectify the defect in his application within seven days of receipt of such notice from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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