2019 (10) TMI 179 - Tri - Insolvency and Bankruptcy

Tribunal Admits Corporate Insolvency Resolution Process Application

Tricolite Electrical Industries Limited Versus HBN Homes Colonisers Private Limited

The Tribunal admitted the application to initiate the Corporate Insolvency Resolution Process against the Corporate Debtor. Mr. Rakesh Kumar Jain was ... Maintainability of application - initiation of CIRP - Corporate Debtor - outstanding amount which is due and payable by the respondent - HELD THAT:- It is evident form the record that the application has been filed on the proforma prescribed under insolvency and bankruptcy (application to adjudicating authority) rules, 2016. We are satisfied that a default has occurred and the application under sub-section 2 of section 9 is complete. The statutory notice under section 8 of the Code was served on the Corporate Debtor as discussed above and no reply was received within the time period as given in Section 8(2) of the Code. The amount claimed to be in default is ₹ 95,01,856/- and the default occurred from 22.08.2015 and application is filed on 24.01.2018 hence the debt is not time barred and the application is filed within the period of limitation. The present application is complete after hearing learned counsel for both the parties and perusing the documents on records it goes beyond doubt that the Applicant is entitled to claim its dues, which remain uncontroverted by the Corporate Debtor, establishing the default in payment of the operational debt beyond doubt. In the light of above facts and records the present application is admitted. Application admitted - moratorium declared. Issues Involved:1. Initiation of Corporate Insolvency Resolution Process (CIRP)2. Outstanding debt and default by the Corporate Debtor3. Validity of invoices and payments made to a third party4. Compliance with the procedural requirements under the Insolvency and Bankruptcy Code (IBC), 2016Issue-wise Detailed Analysis:1. Initiation of Corporate Insolvency Resolution Process (CIRP):The application was filed under section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC 2016) read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 by the Applicant, Tricolite Electrical Industries Limited, to initiate the Corporate Insolvency process against HBN Homes Colonisers Private Limited (Corporate Debtor).2. Outstanding Debt and Default by the Corporate Debtor:The Applicant raised various invoices amounting to Rs. 3,21,24,511/- against the Corporate Debtor. The Corporate Debtor paid Rs. 2,62,96,033/-, leaving an outstanding amount of Rs. 58,28,478/- along with interest of Rs. 36,73,378/- @18% as on 30.09.2017, totaling Rs. 95,01,856/-. The Applicant issued a demand notice under section 8 of IBC, 2016, which was served through speed post. No notice of dispute was raised by the Corporate Debtor, nor was the money paid.3. Validity of Invoices and Payments Made to a Third Party:The Corporate Debtor raised objections, claiming that four invoices were never delivered and that the amount of Rs. 34,60,240/- was transferred to Mitelite Electric Company, a sister concern of the Applicant, on behalf of the Corporate Debtor. The Applicant countered by providing evidence that the invoices were received by the Corporate Debtor and that the transfer to Mitelite Electric Company was mutually agreed upon. The Tribunal found the Applicant's contentions plausible and the Corporate Debtor's objections unsupported by evidence.4. Compliance with Procedural Requirements under IBC, 2016:The Tribunal examined the application under sub-section 5(i) of section 9 of the IBC, ensuring it was complete, the unpaid operational debt was not repaid, the notice for payment was delivered, no notice of dispute was received, and no disciplinary proceedings were pending against the proposed Interim Resolution Professional (IRP). The Tribunal was satisfied that the application met all the requirements of section 9 of the Code.Conclusion:The Tribunal admitted the application, initiating the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor. Mr. Rakesh Kumar Jain was appointed as the Interim Resolution Professional (IRP), and a moratorium was declared in terms of Section 14 of the Code. The Tribunal directed the Operational Creditor to deposit Rs. 2 lakhs with the IRP for expenses. The IRP was tasked with performing all functions as per the Code, and all personnel connected with the Corporate Debtor were legally obligated to assist the IRP. The application was admitted under Section 9(5) of IBC, 2016, and copies of the order were to be communicated to the Applicant, Corporate Debtor, and the Insolvency and Bankruptcy Board of India (IBBI).