Operational Creditor's Insolvency Application Granted: Appointment of Interim Resolution Professional

The court admitted the Operational Creditor's application under Section 9 of the Insolvency & Bankruptcy Code 2016 against the Corporate Debtor for non-payment of lease rent. Evidence supported the claim, leading to the appointment of an Interim Resolution Professional (IRP) and declaration of a moratorium. Mr. A. Mohan Kumar was appointed as the IRP, tasked with managing the Corporate Debtor during the insolvency resolution process. The moratorium period included restrictions on legal actions against the Corporate Debtor and ensured the continuity of essential goods/services supply. The resolution process was to be completed within 180 days from the order date.

---

---

Issues: Application under Section 9 of the Insolvency & Bankruptcy Code 2016 for Corporate Insolvency Resolution Process, dispute over unpaid lease rent, appointment of Interim Resolution Professional (IRP), declaration of moratorium.

Analysis:
1. The Operational Creditor filed an application under Section 9 of the Insolvency & Bankruptcy Code 2016 seeking to initiate the Corporate Insolvency Resolution Process against the Corporate Debtor. The Operational Creditor alleged non-payment of lease rent by the Corporate Debtor for premises sublet by the Lessee with the consent of the Operational Creditor. The Demand Notice dated 14.09.2017 under Section 8 of the I&B Code demanded payment of Rs. 28,04,553/- with interest. The Corporate Debtor disputed the claim, asserting no agreement existed between them, but evidence presented by the Operational Creditor contradicted this assertion.

2. The Operational Creditor fulfilled the requirements of law for admission of the application, including submission of Affidavit, Bank certificate, and proposing the name of the IRP. The Operational Creditor also provided evidence of clear understanding between the parties regarding their landlord-tenant relationship. The Bench found the Corporate Debtor in default of payment and admitted the application, initiating the Corporate Insolvency Resolution Process, which should ordinarily be completed within 180 days from the date of the order.

3. Mr. A. Mohan Kumar was appointed as the IRP, with no pending disciplinary proceedings against him. The IRP was directed to take immediate charge of the Corporate Debtor's management and make a public announcement as prescribed under the I&B Code. A moratorium was declared from the date of the order until the completion of the Corporate Insolvency Resolution Process, prohibiting various actions against the Corporate Debtor, including suits, asset transfers, and recovery of property.

4. During the moratorium period, the supply of essential goods or services to the Corporate Debtor was not to be terminated, suspended, or interrupted. The IRP was mandated to comply with specific provisions of the Code, and the Directors, Promoters, or persons associated with the management of the Corporate Debtor were directed to cooperate with the IRP. The Registry was instructed to communicate the order to all relevant parties and provide necessary details to the IRP for compliance with the provisions of the I&B Code.

---