Court admits petition for corporate insolvency resolution process, appoints interim resolution professional

The petition for initiating the corporate insolvency resolution process (CIRP) against the corporate debtor was admitted. The moratorium was declared, and Mr. Mukesh Kumar was appointed as the interim resolution professional. The operational creditor is to deliver a copy of the order to the interim resolution professional, and the Registry is directed to send a copy of the order to his email address forthwith. The order was pronounced in open court on July 26, 2019.

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Issues Involved:
1. Jurisdiction of the Tribunal
2. Existence of Operational Debt
3. Proper Service of Demand Notice
4. Dispute of Operational Debt
5. Compliance with Section 9(5)(i) of the Insolvency and Bankruptcy Code, 2016
6. Declaration of Moratorium
7. Appointment of Interim Resolution Professional

Detailed Analysis:

1. Jurisdiction of the Tribunal:
The registered office of the corporate debtor is located at Plot No. 109, Sector-27/28, Hissar HR, 125005, which falls under the jurisdiction of the Chandigarh Bench of the National Company Law Tribunal (NCLT). This was confirmed by the master data at page 36 of the petition and noted in the order dated October 26, 2018.

2. Existence of Operational Debt:
The operational creditor was approached by the corporate debtor and awarded a work order for the supply, commissioning, and service of a Solar Power Project. An EPC agreement dated May 1, 2014, was entered into for the project execution. Two invoices dated January 31, 2015, amounting to Rs. 28,45,00,000, and additional security charges of Rs. 73,682 were issued, totaling Rs. 28,45,73,682. Payments amounting to Rs. 25,63,24,719 were received, with the last payment of Rs. 2,00,000 received on July 25, 2016. The total amount of debt claimed is Rs. 2,82,48,963 along with interest at 18% per annum.

3. Proper Service of Demand Notice:
A demand notice in Form No. 4 was issued on March 8, 2018, and served by speed post on March 13, 2018. Additionally, the notice was served to the key managerial person of the corporate debtor via email on March 9, 2018. The email did not bounce, confirming proper service of the demand notice.

4. Dispute of Operational Debt:
No reply was given by the corporate debtor to the demand notice, and no dispute of unpaid operational debt was raised. Despite being duly served, there was no representation from the corporate debtor on the hearing dates of December 13, 2018, January 8, 2019, February 4, 2019, February 25, 2019, and July 19, 2019. Thus, no dispute regarding the operational debt was proved.

5. Compliance with Section 9(5)(i) of the Insolvency and Bankruptcy Code, 2016:
The application filed in Form No. 5 was found to be complete. There was an unpaid operational debt of Rs. 2,82,48,963 along with interest at 18% per annum. The financial statements and a CA certificate confirmed the debt outstanding. The demand notice was properly delivered, and no reply was received, proving no pre-existing dispute. No interim resolution professional was proposed by the operational creditor.

6. Declaration of Moratorium:
The Tribunal declared a moratorium under section 14(1) of the Code, which includes the suspension of suits or proceedings against the corporate debtor, prohibition of transferring or disposing of any assets, and actions to foreclose or recover any property. The supply of essential goods or services to the corporate debtor shall not be terminated during the moratorium period.

7. Appointment of Interim Resolution Professional:
The Tribunal appointed Mr. Mukesh Kumar as the interim resolution professional, as per the panel approved for the NCLT Chandigarh Bench. His credentials were verified, and there was nothing adverse against him. The interim resolution professional is to exercise all powers vested under the Code and perform duties, including taking control and custody of the corporate debtor's assets. He is directed to make a public announcement, constitute a committee of creditors, and submit regular progress reports to the Tribunal.

Conclusion:
The petition for initiating the corporate insolvency resolution process (CIRP) against the corporate debtor was admitted. The moratorium was declared, and Mr. Mukesh Kumar was appointed as the interim resolution professional. The operational creditor is to deliver a copy of the order to the interim resolution professional, and the Registry is directed to send a copy of the order to his email address forthwith. The order was pronounced in open court on July 26, 2019.

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