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of <h1>Petition granted, moratorium declared, IRP appointed to oversee corporate insolvency resolution process.</h1> <h3>Indu Corporation (P.) Ltd. Versus Shree Narmada Architectural Systems (P.) Ltd.</h3> The petition was admitted, and the moratorium was declared by the tribunal. The registry was directed to inform the Registrar of Companies to halt any ... Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - time limitation - HELD THAT:- On perusal of the records it is found that having failed to get the outstanding payments from the respondent, the applicant was compelled to issue demand notice under section 8 of I & B Code on 06.06.2018. Record also shows that the respondent has not raised any reply/dispute against the demand notice so issued by the applicant within the stipulated time limit. This adjudicating authority is of the considered view that operational debt is due to the Applicant and it fulfilled the requirement of IB Code. That, Applicant is an Operational Creditor within the meaning of section 5 sub-section 20 of the Code - From the material on record, petitioner is able to establish that there exists debt as well as occurrence of default and the amount claimed by operational creditor is payable in law by the corporate debtor as the same is not barred by any law of limitation and/or any other law for the time being in force. It is a fit case to initiate Insolvency Resolution Process by admitting the Application under section 9(5)(1) of the Code - petition admitted - moratorium declared. Issues Involved:1. Existence of operational debt.2. Validity of the demand notice and response.3. Limitation period for filing the petition.4. Acknowledgment of debt by the corporate debtor.5. Impact of pending proceedings before Debt Recovery Tribunal.6. Requirements under Section 9 of the Insolvency and Bankruptcy Code, 2016.7. Declaration of moratorium and appointment of Interim Resolution Professional (IRP).Detailed Analysis:1. Existence of Operational Debt:The petitioner, an operational creditor, supplied steel and allied materials to the corporate debtor, with outstanding payments for the period from 30.06.2015 to 08.08.2015. The petitioner provided invoices, proof of delivery, 'C' forms, and input tax credit details to substantiate the claim. The total amount claimed was Rs. 4,57,71,578, including interest at 18% per annum.2. Validity of the Demand Notice and Response:The demand notice was issued on 06.06.2018 and received by the respondent on 12.06.2018. The corporate debtor replied on 05.07.2018, beyond the stipulated 10-day period. The tribunal noted the delayed response and considered the demand notice valid.3. Limitation Period for Filing the Petition:The last invoice date was 22.09.2015, and the last payment was received on 31.03.2016. The petition was filed within the limitation period as the last payment extended the limitation period. The tribunal dismissed the respondent's argument that the petition was time-barred.4. Acknowledgment of Debt by the Corporate Debtor:The corporate debtor made a payment of Rs. 2,00,000 on 31.03.2016. The tribunal found that payments were made on an ad hoc basis rather than bill-to-bill, thus considering the payment as acknowledgment of debt.5. Impact of Pending Proceedings Before Debt Recovery Tribunal:The corporate debtor argued that the factory premises were taken over by a receiver appointed under an ex parte order of DRT-III, Mumbai, from 06.08.2015 to 05.10.2015. The tribunal ruled that the Bankruptcy Code has an overriding effect and pending proceedings before the Debt Recovery Tribunal do not impede the initiation of the insolvency resolution process.6. Requirements Under Section 9 of the Insolvency and Bankruptcy Code, 2016:The tribunal referred to the Supreme Court judgment in Mobilox Innovations (P.) Ltd. v. Kirusa Software (P.) Ltd., which outlines the requirements for an application under Section 9:- Existence of operational debt exceeding Rs. 1 lakh.- Documentary evidence showing the debt is due and payable.- No existence of a dispute or pending suit/arbitration proceeding before the receipt of the demand notice.The tribunal found that the operational debt was due, payable, and undisputed, fulfilling the requirements of the Code.7. Declaration of Moratorium and Appointment of Interim Resolution Professional (IRP):The tribunal declared a moratorium prohibiting:- Institution or continuation of suits or proceedings against the corporate debtor.- Transfer, encumbrance, or disposal of the corporate debtor's assets.- Foreclosure, recovery, or enforcement of security interests.- Recovery of property occupied by the corporate debtor.The tribunal directed the supply of essential goods and services to continue during the moratorium period. The order would remain effective until the completion of the corporate insolvency resolution process or approval of a resolution plan.The tribunal appointed Shri Manish Kumar Bhagat as the Interim Resolution Professional (IRP) and directed the IRP to make a public announcement and call for submission of claims.Conclusion:The petition was admitted, and the moratorium was declared. The tribunal directed the registry to inform the Registrar of Companies to halt any proceedings for striking off the respondent company's name, ensuring the continuity of the corporate insolvency resolution process.
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