Tribunal grants insolvency application under IBC 2016, appoints professional, declares moratorium

The Tribunal allowed the application under section 9 of IBC, 2016 for default in payment, finding no valid dispute raised by the respondent. An interim insolvency professional was appointed to manage the corporate debtor, with a moratorium declared to protect the debtor from legal actions. The insolvency resolution process was set in motion, with the Registry directed to ensure compliance with the order and inform relevant parties accordingly.

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Issues: Application under section 9 of IBC, 2016 for default in payment; Existence of dispute; Appointment of interim insolvency professional; Declaration of moratorium.

Analysis:
1. The Tribunal examined an application filed under section 9 of the Insolvency and Bankruptcy Code, 2016, regarding a default in payment by the corporate debtor. The statutory notice dated 27.02.2017 highlighted the default, and although the respondent raised some issues in their reply, they did not constitute a valid dispute as per the agreement between the parties. The operational creditor submitted an affidavit along with a bank statement. Despite the respondent's failure to receive the petition due to an endorsement issue, the Tribunal found all legal requirements fulfilled and allowed the application for the commencement of the corporate insolvency resolution process within 180 days.

2. The Tribunal appointed Mr. V. Mahesh as the interim insolvency professional, directing him to take immediate charge of the corporate debtor. Mr. Mahesh was also tasked with making a public announcement as per Section 15 of the Code within three days of receiving the order copy, inviting submissions of claims under Section 15 of IBC 2016. The Tribunal declared a moratorium effective from the order date until the completion of the corporate insolvency resolution process, prohibiting various actions against the corporate debtor, including institution of suits, asset transfers, enforcement of security interests, and property recovery.

3. The Registry was instructed to inform the Insolvency Resolution Professional to assume control of the entity and comply with the order as per the provisions of IBC, 2016. Subsequently, the Tribunal admitted the application and directed the Registry to communicate the order to both the operational creditor and the corporate debtor.

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