2020 (2) TMI 1472 - Tri - Insolvency and Bankruptcy

Insolvency Application Admitted Against Independent TV Limited

The National Company Law Tribunal, Mumbai Bench-IV, admitted the application under section 7 of the Insolvency & Bankruptcy Code, 2016, filed by Noble ... Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditor - existence of debt and dispute or not - HELD THAT:- The financial debt amounting to more than ₹ 1,00,000/- is due and payable by the Corporate Debtor to the Applicant. There is default by the Corporate Debtor in repayment of the loan amount - The application is complete and has been filed under the proper form. The debt amount is more than Rupees One Lakh and default of the Corporate Debtor has been established and the application deserves to be admitted. Application admitted - moratorium declared. Issues:1. Application under section 7 of Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process (CIRP).2. Default in repayment of loan amount by the Corporate Debtor.3. Allegations of fraudulent and malicious proceedings by the Corporate Debtor.4. Appointment of Interim Resolution Professional and declaration of moratorium.Analysis:Issue 1: Application under section 7 of Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process (CIRP):The application (C.P. (IB) No. 3176/NCLT/MB/CIV/2019) was filed by Noble Co-operative Bank Limited, the Financial Creditor, against Independent TV Limited, the Corporate Debtor, seeking initiation of CIRP under section 7 of the I&B Code. The Financial Creditor claimed a total default amount along with interest and penal charges, supported by loan agreements, hypothecation agreements, and guarantee deeds. The Tribunal found the application complete, debt exceeding the threshold, and established default, leading to the admission of the application.Issue 2: Default in repayment of loan amount by the Corporate Debtor:The Financial Creditor provided evidence of disbursed loan amounts, default by the Corporate Debtor from June 2019, and subsequent failed attempts of recovery through notices. The Corporate Debtor denied the allegations, claiming a conspiracy and non-availability of the financed vehicles. However, the Tribunal, after hearing both parties and examining the records, concluded the existence of a financial debt exceeding one lakh rupees and established the default by the Corporate Debtor, justifying the admission of the application.Issue 3: Allegations of fraudulent and malicious proceedings by the Corporate Debtor:The Corporate Debtor filed an application (MA 206/2020) alleging fraudulent and malicious proceedings by the Financial Creditor, which was dismissed by the Tribunal as an attempt to deviate from the main issue. The Corporate Debtor's claims of conspiracy and non-availability of financed vehicles were refuted based on documentary evidence provided by the Financial Creditor, including registration certificates and loan agreements.Issue 4: Appointment of Interim Resolution Professional and declaration of moratorium:The Tribunal admitted the application for initiating CIRP, appointed Mr. Anup Kumar as the Interim Resolution Professional, and declared a moratorium under section 14 of the I&B Code. The order included prohibitions on legal actions against the Corporate Debtor, continuation of essential supplies, and specified exceptions to the moratorium. Additionally, directions were given regarding the management of the Corporate Debtor, deposit by the Financial Creditor for expenses, and communication of the order to relevant parties and authorities.This detailed analysis covers the key issues addressed in the judgment delivered by the National Company Law Tribunal, Mumbai Bench-IV, in the mentioned case.