Section 7 IBC admission upheld where financial debt, default, complete records, and eligible resolution professional were shown.

A Section 7 IBC application was admitted where the financial creditor proved disbursement of credit facilities, subsisting liability and non-payment through sanction letters, loan records, account statements and demand notice. The corporate debtor also admitted the debt in its reply affidavit. The tribunal found the application complete in the prescribed form, supported by the required documents, and noted that the proposed interim resolution professional faced no pending disciplinary proceeding. On satisfaction of these statutory conditions, admission followed and moratorium under Section 14 came into force.

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Issues: Whether the financial creditor established default and completion of the statutory requirements under Section 7 of the Insolvency and Bankruptcy Code, 2016 for admission of the insolvency application and commencement of moratorium.

Analysis: The application was supported by sanction letters, loan documents, account statements, demand notice and other material showing disbursement of credit facilities, subsisting liability and non-payment by the corporate debtor. The debt was admitted in the reply affidavit filed for the corporate debtor. The application was found to be in the prescribed form, supported by the required documents and accompanied by a proposed interim resolution professional against whom no disciplinary proceeding was pending. On these facts, the statutory conditions for admission were satisfied.

Conclusion: The application under Section 7 was maintainable and was rightly admitted on proof of financial debt and default.

Final Conclusion: Insolvency proceedings were commenced against the corporate debtor and moratorium came into force in accordance with the Code.

Ratio Decidendi: Once the adjudicating authority is satisfied that a financial debt exists, default is established, and the application is complete with no disqualifying disciplinary proceeding against the proposed resolution professional, admission under Section 7 follows and moratorium under Section 14 is attracted.

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