Operational debt and default proved by invoices and part-payment, leading to insolvency admission and moratorium under the Code.

The operational creditor established operational debt and default through purchase orders, invoices, part-payment by the corporate debtor, and no substantiated pre-existing dispute, so the NCLT admitted the insolvency petition under the Insolvency and Bankruptcy Code, 2016. Service of the section 8 demand notice was treated as complete on the record, supported by electronic service and a section 65B affidavit. On admission, the statutory moratorium under section 14 came into force for the duration of the corporate insolvency resolution process.

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Issues: Whether the operational creditor established operational debt and default so as to admit the petition under the Insolvency and Bankruptcy Code, 2016, and whether moratorium under the Code followed upon admission.

Analysis: The operational creditor placed material showing supply of goods under purchase orders, issuance of invoices, part-payment by the corporate debtor, and absence of any substantiated pre-existing dispute. Service of the demand notice under section 8 was treated as complete on the record, and the tribunal also took note of electronic service and the evidentiary affidavit under section 65B of the Indian Evidence Act, 1872. On these facts, the statutory requirements for admission of the application were satisfied. Once admitted, the statutory moratorium under section 14 operated for the duration of the corporate insolvency resolution process, subject to the Code.

Conclusion: The petition was admitted and the corporate insolvency resolution process was initiated against the corporate debtor, with moratorium coming into force.

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