Corporate insolvency admission depends on proved default, a complete filing, and valid authority to present the petition.

An application for initiation of corporate insolvency under the Insolvency and Bankruptcy Code is admissible when default is evidenced by disbursement records, non-performing asset classification, recall notice and supporting credit data, the prescribed form is complete, and no disciplinary proceeding is pending against the proposed interim resolution professional. A broadly worded power of attorney authorising proceedings before courts and tribunals is sufficient to validate the filing, even if executed before the Code came into force. On these conditions, the insolvency process may proceed with appointment of an interim resolution professional and consequent moratorium.

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Issues: (i) Whether the financial creditor had established default and filed a complete application so as to warrant admission under section 7 of the Insolvency and Bankruptcy Code, 2016. (ii) Whether the objection to the petition on the ground of invalid authority of the signatory was sustainable.

Issue (i): Whether the financial creditor had established default and filed a complete application so as to warrant admission under section 7 of the Insolvency and Bankruptcy Code, 2016.

Analysis: The application was filed in the prescribed form under the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. The record showed disbursement of financial debt, persistent default, declaration of the account as non-performing asset, recall notice, and documentary material including bank records and credit information reports. The Tribunal found that default had occurred, the application was complete, and no disciplinary proceedings were pending against the proposed interim resolution professional. The statutory conditions for admission under section 7 were therefore satisfied.

Conclusion: The issue was decided in favour of the financial creditor, and the petition was admitted.

Issue (ii): Whether the objection to the petition on the ground of invalid authority of the signatory was sustainable.

Analysis: The Tribunal held that the power of attorney was sufficiently wide to authorise institution of proceedings before courts and tribunals. The objection that the instrument predated the Insolvency and Bankruptcy Code, 2016 was rejected, as the authority conferred was not confined to any single enactment and extended to proceedings of the present kind.

Conclusion: The objection was rejected and the petition was held to be validly presented.

Final Conclusion: The corporate insolvency resolution process was triggered, an interim resolution professional was appointed, and moratorium under the Code followed.

Ratio Decidendi: An application under section 7 of the Insolvency and Bankruptcy Code, 2016 is admissible when default is established, the application is complete, and the proposed interim resolution professional is free from disciplinary proceedings; a broadly worded power of attorney authorising litigation before courts and tribunals is sufficient to institute such proceedings.

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