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Issues: (i) whether an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is maintainable against a company whose name has been struck off from the Register of Companies; (ii) whether the amount advanced constituted a financial debt and the petition could fail on the plea that it was only an advance for purchase of materials; (iii) whether objections regarding proposed interim resolution professional, alleged discrepancies in dates, and absence of a board resolution under Section 186 of the Companies Act, 2013 defeated maintainability.
Issue (i): whether an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is maintainable against a company whose name has been struck off from the Register of Companies
Analysis: The statutory scheme under Sections 248, 250 and 252 of the Companies Act, 2013 shows that striking off does not extinguish all consequences of corporate existence for the purpose of liabilities and restoration. The Tribunal also relied on the insolvency framework to hold that CIRP is intended to deal with the corporate debtor's assets and liabilities notwithstanding striking off, and that the Adjudicating Authority can restore the name of the company for insolvency proceedings.
Conclusion: The application under Section 7 was held maintainable against the struck off company, in favour of the petitioner.
Issue (ii): whether the amount advanced constituted a financial debt and the petition could fail on the plea that it was only an advance for purchase of materials
Analysis: The ledger entry described the payment as amount paid towards loan and advances. No material was produced to establish that the payment was an advance for purchase of goods. The absence of a written agreement, promissory note or post-dated cheques was held not decisive of the character of the transaction, and the surrounding material supported the existence of a loan arrangement.
Conclusion: The amount was treated as a financial debt and the objection that it was merely an advance was rejected, in favour of the petitioner.
Issue (iii): whether objections regarding proposed interim resolution professional, alleged discrepancies in dates, and absence of a board resolution under Section 186 of the Companies Act, 2013 defeated maintainability
Analysis: The defect regarding non-proposal of an interim resolution professional was permitted to be cured by filing the necessary particulars and consent. The inconsistencies in dates were treated as technical and not affecting the maintainability of the Section 7 petition. The objection based on Section 186 of the Companies Act, 2013 was rejected in view of the overriding effect of the Insolvency and Bankruptcy Code, 2016.
Conclusion: These objections did not defeat the petition and were rejected, in favour of the petitioner.
Final Conclusion: The petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 was admitted and corporate insolvency resolution process was directed to commence against the corporate debtor, with moratorium and appointment of an interim resolution professional.
Ratio Decidendi: A struck off company remains amenable to CIRP under the Insolvency and Bankruptcy Code, 2016, and technical defects or formal objections do not defeat admission where the debt and default are otherwise established.
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