Court Admits Petition for Corporate Insolvency Resolution Process

The court admitted the petition for initiating the Corporate Insolvency Resolution Process against the respondent-corporate debtor. Mr. Madan Gopal Jindal was appointed as the Interim Resolution Professional, and a moratorium was declared in accordance with the Insolvency and Bankruptcy Code, 2016. The tribunal directed the Interim Resolution Professional to oversee the affairs of the corporate debtor and provide regular progress reports.

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Issues Involved:
1. Service of Demand Notice
2. Existence of Debt and Default
3. Dispute Regarding Payment and Contractual Obligations
4. Appointment of Interim Resolution Professional (IRP)
5. Declaration of Moratorium

Issue-wise Detailed Analysis:

1. Service of Demand Notice:
The first issue for consideration was whether the demand notice on Form No. 3 dated 09.06.2018 was properly served. The demand notice was sent by DTDC Courier and delivered to the respondent-corporate debtor on 11.06.2018. It was also sent to the respondent's email address. The tribunal found that the demand notice was properly served as per the tracking report and email records.

2. Existence of Debt and Default:
The tribunal examined the application filed on Form No. 5 and found it complete. There was an unpaid operational debt amounting to Rs. 68,77,460/- (excluding interest claimed by the Operational Creditor @24%). The tribunal referred to the ledger, sale invoices, and dishonored cheques as evidence of the debt. The tribunal also noted that no notice of dispute was received by the operational creditor, fulfilling the conditions under Section 9(5)(i) of the Insolvency and Bankruptcy Code, 2016.

3. Dispute Regarding Payment and Contractual Obligations:
The respondent-corporate debtor claimed that the original agreement dated 02.06.2016 was modified by a supplementary oral agreement dated 22.12.2017. They argued that the petitioner breached the contract by dishonoring post-dated cheques and stopping business without notice. The petitioner rebutted these claims, stating that the cheques were dishonored due to being "stopped by the drawer" and that the respondent took illegal possession of the petitioner’s products/stock. The tribunal found that the respondent's arguments did not constitute a valid dispute as per the legal standards set by previous judgments, including the Mobilox Innovations case.

4. Appointment of Interim Resolution Professional (IRP):
The tribunal noted that the operational creditor did not propose the name of any Resolution Professional. Therefore, the tribunal referred to the Board for the recommendation of an insolvency professional. Mr. Madan Gopal Jindal was appointed as the Interim Resolution Professional. The tribunal verified his credentials and found nothing adverse against him.

5. Declaration of Moratorium:
The tribunal declared a moratorium in terms of Section 14 of the Code, prohibiting:
- The institution or continuation of suits or proceedings against the corporate debtor.
- Transferring, encumbering, or disposing of any assets of the corporate debtor.
- Actions to foreclose, recover, or enforce any security interest.
- Recovery of property occupied by the corporate debtor.

The tribunal directed that the supply of essential goods or services to the corporate debtor should not be terminated or suspended during the moratorium period. The moratorium will remain effective until the completion of the Corporate Insolvency Resolution Process or until the tribunal approves a resolution plan or orders liquidation.

Conclusion:
The petition for initiating the Corporate Insolvency Resolution Process against the corporate debtor was admitted. The tribunal appointed Mr. Madan Gopal Jindal as the Interim Resolution Professional and declared a moratorium as per the provisions of the Insolvency and Bankruptcy Code, 2016. The tribunal directed the Interim Resolution Professional to manage the affairs of the corporate debtor and report progress regularly.

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