Application under Section 7 admitted: CMYK Printech Limited faces insolvency proceedings

The National Company Law Tribunal, New Delhi, admitted an Application under Section 7 of the Insolvency and Bankruptcy Code, 2016, filed by a Financial Creditor against CMYK Printech Limited for default in returning share application money. The Tribunal ordered the commencement of Corporate Insolvency Resolution Process (CIRP) within 180 days, declaring a moratorium to protect the Corporate Debtor from various actions. Mr. Ranjeet Kumar Verma was appointed as the Interim Resolution Professional (IRP) to manage the Corporate Debtor's affairs and oversee the submission of creditor claims. The Order outlined specific compliance requirements and communication obligations for all parties involved.

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Issues involved:
Application under Section 7 of the Insolvency and Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, default in returning share application money with interest, validity of allotment of shares, appointment of Interim Resolution Professional (IRP), declaration of moratorium.

Analysis:
The judgment by the National Company Law Tribunal, New Delhi, involved an Application filed by a Financial Creditor under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, CMYK Printech Limited. The Financial Creditor had granted an unsecured loan to the Corporate Debtor, which was later converted into equity shares. However, the Corporate Debtor revoked the allotment of shares and failed to return the share application money along with interest, leading to a default. The Financial Creditor provided documentary evidence to support the default claim, fulfilling all legal requirements and proposing the appointment of an Interim Resolution Professional (IRP) after seeking consent. The Tribunal admitted the Application, ordering the commencement of CIRP within 180 days from the date of the Order.

The Tribunal declared a moratorium effective from the date of the Order till the completion of CIRP, prohibiting various actions against the Corporate Debtor, including institution of suits, transferring assets, enforcing security interests, and recovery of property. Essential goods or services supply to the Corporate Debtor was also protected during the moratorium period. Mr. Ranjeet Kumar Verma was appointed as the IRP, with directions to take charge of the Corporate Director's management immediately, including bank accounts, and to cause a public announcement for submission of claims by creditors. The IRP was mandated to comply with specific provisions of the Insolvency and Bankruptcy Code and receive assistance from the Corporate Debtor's Directors and management associates.

The Applicant and their counsel were directed to send a copy of the Order to the Corporate Debtor and IRP promptly for compliance. Contact details of the appointed IRP were provided for communication purposes. Additionally, the Applicant was instructed to communicate the Order to the concerned Registrar of Companies. The Order was pronounced through video conferencing, ensuring all necessary steps for the initiation of CIRP and management of the Corporate Debtor were clearly outlined and implemented.

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