Tribunal approves petition, validates notice, allows interest on late payments, and begins insolvency proceedings.

The tribunal found that the petition was filed with proper authority, the demand notice was valid, bank confirmation was not a prerequisite, interest could be claimed on delayed payments, and evidence supported delivery of goods. The tribunal admitted the petition, declared a moratorium, appointed an Interim Resolution Professional, and initiated the Corporate Insolvency Resolution Process against the corporate debtor in accordance with the Insolvency and Bankruptcy Code.

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Issues Involved:
1. Proper authority to file the petition.
2. Validity of the demand notice.
3. Requirement of bank/financial institution confirmation.
4. Agreement on the rate of interest for delayed payments.
5. Evidence of delivery of goods.

Detailed Analysis:

1. Proper Authority to File the Petition:
The respondent contended that the petition was filed without proper authority. The tribunal found that the applicant company had duly passed a resolution in a Board of Directors meeting on 04.12.2017, authorizing Mr. Pratik D. Shah to file the petition. This resolution was produced in the proceedings, and thus, the tribunal concluded that the petition was filed with proper authority and was not bad in law.

2. Validity of the Demand Notice:
The respondent argued that the notice dated 11.12.2017 did not qualify as a demand notice. The tribunal examined the notice and found it to be supported by all required documents, such as the sale contract, list of invoices, and copies of invoices, as stipulated under the Insolvency and Bankruptcy Code. The tribunal determined that the notice qualified as a valid demand notice under the Code.

3. Requirement of Bank/Financial Institution Confirmation:
The respondent raised an objection that the application did not include copies of relevant accounts from the bank or financial institution confirming that no payment was received from the respondent. The tribunal referred to the Supreme Court's decision in Macquarie Bank Limited v. Shilpi Cable Technologies Limited, which clarified that such confirmation is only a piece of evidence and not a condition precedent for triggering the insolvency process. The tribunal noted that other documentary evidence can prove the occurrence of default, and thus, this objection was not upheld.

4. Agreement on the Rate of Interest for Delayed Payments:
The respondent contended that there was no agreement between the parties regarding the rate of interest for delayed payments. The tribunal referred to the Interest Act, 1978, which allows for the claiming of interest in the recovery of any debt or damages, even in the absence of an explicit agreement. The tribunal concluded that the applicant was entitled to claim interest on the delayed payments.

5. Evidence of Delivery of Goods:
The respondent denied receiving the metal scrap and argued that none of the documents provided by the applicant evidenced the delivery of goods. The tribunal found that prior to the filing of the application, the respondent had never questioned the delivery of goods in their communications with the applicant. The tribunal noted that the documents, such as the sales contract, tax invoice, bill of lading, and others, bore the stamp and signature of the respondent, indicating receipt of the goods. Therefore, the tribunal concluded that the respondent's claim of non-delivery was misleading.

Findings:
The tribunal found that the petition was complete in all respects and that the amount involved was an operational debt due and payable to the applicant. The tribunal referenced the Supreme Court's decision in Mobilox Innovative Private Limited vs. Kirusa Software Private Limited, which outlined the conditions for admitting an application under Section 9 of the Insolvency and Bankruptcy Code. The tribunal determined that all conditions were met and thus admitted the petition.

Order:
The tribunal declared a moratorium prohibiting the institution or continuation of suits or proceedings against the corporate debtor, transferring or disposing of assets, and other specified actions. The tribunal directed the Interim Resolution Professional to make a public announcement of the initiation of the Corporate Insolvency Resolution Process and call for submission of claims. The tribunal appointed Shri Sunil Kumar Agarwal as the Interim Resolution Professional and directed the registry to inform the Registrar of Companies about the corporate insolvency resolution process.

Conclusion:
The petition was admitted, and a moratorium was declared, initiating the Corporate Insolvency Resolution Process against the corporate debtor. The tribunal directed the necessary actions to be taken as per the provisions of the Insolvency and Bankruptcy Code.

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