Section 7 insolvency application admitted after default was established and the proposed resolution professional was cleared.

A Section 7 Insolvency and Bankruptcy Code application was treated as complete where the financial debt, assignment in favour of the applicant, non-performing account classification, and SARFAESI notice and possession steps supported default. The corporate debtor raised no objection to admission, and no disciplinary proceedings were pending against the proposed interim resolution professional. On that basis, the petition was admitted, corporate insolvency resolution process was directed to commence, and a moratorium under the Insolvency and Bankruptcy Code was ordered.

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Issues: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 was complete and whether default was established so as to admit the petition and commence the corporate insolvency resolution process.

Analysis: The financial debt, assignment in favour of the applicant, classification of the account as non-performing, and the notice and possession steps under the SARFAESI Act supported the existence of default. The corporate debtor also stated that it had no objection to admission. The application was found to be in the prescribed form, the default was held to have occurred, and no disciplinary proceedings were pending against the proposed interim resolution professional.

Conclusion: The petition was admitted, the corporate insolvency resolution process was directed to commence, a moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 was , and the proposed interim resolution professional was appointed.

Ratio Decidendi: Where default is established, the Section 7 application is complete, and no disciplinary proceedings are pending against the proposed resolution professional, the adjudicating authority must admit the insolvency application and initiate the corporate insolvency resolution process.

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