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TMI Blog2022 (6) TMI 1217X X X X Extracts X X X X X X X X Extracts X X X X ..... filed under Section 7 of the IBC. To admit an application filed under Section 7 of IBC, the Adjudicating Authority is to be satisfied that a default has occurred; that the Corporate Debtor is entitled to point out that default has not occurred in the sense that the debt , which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the Adjudicating Authority is satisfied that a default has occurred, the Application must be admitted unless it is incomplete. The application made by the Financial Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable, and the default is in excess of the minimum amount stipulated under Section 4(1) of the IBC. Therefore, the debt and default stand established and there is no reason to deny the admission of the Petition. Petition admitted - moratorium declared. - CP (IB)/ 22/KOB/2022 - - - Dated:- 23-6-2022 - Hon ble Mr. Ashok Kumar Borah, Member (Judicial) Hon ble Mr. Anil Kumar. B, Member (Technical) For Financial Creditor : Mr. Sandeep Kumar S, Ms. Midhuna K C, PCSs For Corpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dditional term loan of Rs. 298.00 Lakh was released in 5 tranches. 5. As per the terms of the loan agreements executed by the Corporate Debtor in favour of the Applicant/ Financial Creditor, the Corporate Debtor had agreed to repay the loan in instalments commencing after the moratorium period prescribed and also agreed to pay interest as prescribed per annum, compounded quarterly or such rate as may be fixed by the Applicant/ Financial Creditor. 6. The applicant submitted that the Corporate Debtor committed serious breach and default in repaying the above loans together with interest due thereon within the stipulated time. It is further submitted that several repayment demands were initiated by the Applicant/ Financial Creditor but the Corporate Debtor showed an apparent unwillingness to repay the due amount. 7. The Financial Creditor extended various directions / concessions / reliefs to the promoters of the Corporate Debtor and based on this, balance amount of Rs 146 Lakh out of the additional term loan of Rs. 298 Lakh was further released to the Corporate Debtor on 01.10.2016, which was pending for disbursement due to delay in implementation of the Projects as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in its Letter No.KSIDC/TVM/SCY 8/323 BM/1190 dated 31st August,202l. As per the said OTS, the OTS shall be valid till 31.12.2021 and 10% of the OTS amount to be remitted within One month from the date of sanction. However, the Corporate Debtor again failed to remit 10% of the OTS amount within One month from the date of OTS sanction nor concluded the OTS within 31.12.2021 and expressed its unwillingness to fulfill its pecuniary obligations. The Applicant / Financial Creditor was, therefore, constrained to cancel this OTS. Advance intimation was given regarding cancellation of OTS Vide its letter No. KSIDC/CHN/REC/2021/822 dated 24.11.2021. 11. The learned PCS for the applicant argued that as of the date of filing this Application, the Corporate Debtor has an outstanding default amount of Rs. 20,81,37,531/- Rupees Twenty Crores Eighty-One Lakh Thirty-Seven Thousand Five Hundred and Thirty-One Only). 12. The applicant stated that the Corporate Debtor has not only failed and neglected to discharge its debt towards the Applicant/Financial Creditor, but also has demonstrated that the affairs of the Corporate Debtor are at a commercial standstill and can be described to be commer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editor triggering the process, Section 7 becomes relevant. Under the Explanation to Section 7(1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor - it need not be a debt owed to the applicant financial creditor. Under Section 7(2), an application is to be made under sub-section (1) in such form and manner as is prescribed, which takes us to the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Under Rule 4, the Application is made by a financial creditor in Form 1 accompanied by documents and records required therein. Form 1 is a detailed form in 5 parts, which requires particulars of the applicant in Part I, particulars of the corporate debtor in Part II, particulars of the proposed interim resolution professional in Part III, particulars of the financial debt in Part IV and documents, records and evidence of default in Part V. Under Rule 4(3), the applicant is to dispatch a copy of the Application filed with the adjudicating authority by registered post or speed post to the registered office of the corporate debtor. The speed, within which the adjudicating authority is to ascertain the existence of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : 54. It is clear from these sections that information in respect of debts incurred by financial debtors is easily available through information utilities which, under the Insolvency and Bankruptcy Board of India (Information Utilities) Regulations, 2017 (Information Utilities Regulations), are to satisfy themselves that information provided as to the debt is accurate. This is done by giving notice to the corporate debtor who then has an opportunity to correct such information. 55. Apart from the record maintained by such utility, Form I appended to the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, makes it clear that the following are other sources which evidence a financial debt: (a) Particulars of security held, if any, the date of its creation, its estimated value as per the Creditor; (b) Certificate of registration of charge issued by the Registrar of Companies (if the corporate debtor is a company); (c) Order of a court, tribunal or arbitral panel adjudicating on the default; (d) Record of default with the information utility; (e) Details of succession certificate, or probate of a will, or letter of adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 4(1) of the IBC. Therefore, the debt and default stand established and there is no reason to deny the admission of the Petition. 20. It is, accordingly, ordered as follows: - (a) The petition bearing CP (IB) 22/KOB/2022 filed by Kerala State Industrial Development Corporation, the Financial Creditor, under Section 7 of the IBC read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 for initiating Corporate Insolvency Resolution Process (CIRP) against Kumarakom Aqua Serene Private Limited [CIN: U55101KL2004PTC016902], the Corporate Debtor, is admitted. (b) There shall be a moratorium under Section 14 of the IBC, with regard to the following: (i) The institution of suits or continuation of pending suits or proceedings against the Corporate Debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; (ii) Transferring, encumbering, alienating or disposing of by the Corporate Debtor any of its assets or any legal right or beneficial interest therein; (iii) Any action to foreclose, recover or enforce any security interest created by the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the IBC. (g) During the CIRP Period, the management of the Corporate Debtor shall vest in the IRP or, as the case may be, the RP in terms of Section 17 of the IBC. The officers and managers of the Corporate Debtor shall provide all documents in their possession and furnish every information in their knowledge to the IRP within a period of one week from the date of receipt of this Order, in default of which coercive steps will follow. (h) The Financial Creditor shall deposit a sum of Rs.2,00,000/- (Rupees Two Lakh only) with the IRP to meet the expenses arising out of issuing public notice and inviting claims etc. These expenses are subject to approval by the Committee of Creditors (CoC) and that this amount may not be construed as the fee paid to the IRP. (i) The Registry is directed to communicate this Order to the Financial Creditor, the Corporate Debtor and the IRP by Speed Post and email immediately, and in any case, not later than two days from the date of this Order. (j) IRP is directed to send a copy of this Order to the Registrar of Companies, Kerala, for updating the Master Data of the Corporate Debtor. The said Registrar of Companies shall send a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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