Section 7 insolvency admission upheld where financial debt, default, and application completeness were established despite consortium objections and parallel recovery proceedings.

A Section 7 application under the Insolvency and Bankruptcy Code, 2016 was examined on completeness, proof of financial debt and default, and admissibility of corporate insolvency resolution. The Tribunal held that a financial creditor may file the application on its own, and that consortium arrangements or objections on internal banking authorisation do not defeat maintainability. It further found that the sanctioned and disbursed term loan, loan and security documents, debt acknowledgement, and certified account statements established financial debt and default. Disputes over claim quantum and parallel SARFAESI or DRT proceedings were held not to bar admission. The application was admitted, an interim resolution professional was appointed, and moratorium was declared.

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Issues: Whether the Section 7 application was complete, whether a financial debt and default were established, and whether the corporate insolvency resolution process was liable to be admitted with appointment of an interim resolution professional and moratorium.

Analysis: The application was examined under Section 7 of the Insolvency and Bankruptcy Code, 2016 read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. The record showed sanction and disbursal of a term loan, execution of loan and security documents, acknowledgment of debt, and certified statements of account. The Tribunal held that a financial creditor may file the application by itself, that consortium arrangements do not curtail the statutory right under the Code, and that objections regarding authorization or inter se banking arrangements do not defeat maintainability. It further held that disputes as to quantum of claim or simultaneous SARFAESI and DRT proceedings are not bars to admission under Section 7, since the Adjudicating Authority is only required to ascertain default, completeness of the application, and absence of disciplinary proceedings against the proposed resolution professional.

Conclusion: The application was found complete, default was held to be established, and the petition was admitted. An interim resolution professional was appointed and moratorium was declared.

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