Tribunal admits insolvency application against corporate debtor for non-payment of services

The Tribunal admitted the application under section 9 of the Insolvency and Bankruptcy Code, 2016, against a corporate debtor for non-payment of consultancy services. Despite the debtor's claim of a pre-existing dispute, the Tribunal found discrepancies in the payment claim and lack of a valid dispute. An interim resolution professional was appointed, imposing a moratorium and directing payment for expenses. The application was officially admitted, triggering the moratorium immediately.

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Issues:
Application under section 9 of the Insolvency and Bankruptcy Code, 2016 for initiation of corporate insolvency resolution process against a corporate debtor.

Detailed Analysis:

1. Background and Debt Claim:
The operational creditor filed a petition under section 9 of the IBC against the corporate debtor for non-payment of consultancy and professional services amounting to Rs. 35,00,000. The corporate debtor issued multiple cheques, some of which were dishonored, leading to a total default amount of Rs. 26,85,907. A notice under section 138 of the Negotiable Instruments Act was also issued.

2. Statutory Demand Notice and Response:
A statutory demand notice was sent to the corporate debtor demanding payment within 10 days, following which a detailed reply was received from the corporate debtor claiming partial payment made to a third party. However, the operational creditor contested that no payment was received after a certain point, and the cheques deposited were returned unpaid.

3. Dispute and Admittance of Petition:
The corporate debtor claimed a pre-existing dispute based on a police complaint filed after receiving the notice, but the Tribunal found the complaint post-dated the notice and did not constitute a valid dispute under the IBC. The Tribunal noted discrepancies in the claim of payment made to a third party and admitted the petition due to the corporate debtor's failure to provide a satisfactory explanation for the default.

4. Appointment of Interim Resolution Professional and Moratorium:
In light of the admitted petition, an interim resolution professional was appointed. The moratorium under section 14(1) of the IBC was imposed, restricting the corporate debtor from disposing of assets or initiating legal proceedings. Essential supplies to the corporate debtor were to continue during the moratorium period.

5. Payment to Interim Resolution Professional:
The applicant was directed to pay Rs. 2,00,000 to the interim resolution professional for expenses. The application was officially admitted, and the moratorium came into effect immediately. Copies of the order were to be communicated to all relevant parties and authorities.

This detailed analysis summarizes the key aspects of the judgment, outlining the legal proceedings and decisions taken by the Tribunal in response to the application under the Insolvency and Bankruptcy Code, 2016.

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