Tribunal Admits CIRP Petition, Declares Moratorium |

The tribunal admitted the Corporate Insolvency Resolution Process (CIRP) petition against the corporate debtor, declared a moratorium under Section 14(1) of the Insolvency and Bankruptcy Code, and appointed Mr. Divyanshu Mishra as the Interim Resolution Professional (IRP). This decision was based on the undisputed debt, the corporate debtor's default on payment obligations exceeding Rs. 1 lakh, and compliance with statutory requirements. The moratorium would remain in effect until the completion of the CIRP, approval of a resolution plan, or liquidation order.

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Issues Involved:
1. Proper service of demand notice.
2. Dispute over operational debt.
3. Compliance with Section 9(5)(i) of the Insolvency and Bankruptcy Code, 2016.
4. Admission of Corporate Insolvency Resolution Process (CIRP) petition.
5. Declaration of moratorium.
6. Appointment of Interim Resolution Professional (IRP).

Issue-wise Detailed Analysis:

1. Proper Service of Demand Notice:
The tribunal examined whether the demand notice in Form No. 3 dated 17.12.2018 was properly served. The notice was sent to the registered office of the corporate debtor, as per the master data provided. The postal receipts and tracking reports confirmed successful delivery of the notice, thus fulfilling the statutory requirement.

2. Dispute Over Operational Debt:
The tribunal considered whether the operational debt was disputed by the corporate debtor. The respondent’s reply acknowledged the existing debt and liability of Rs. 22,78,708/-. There was no dispute regarding the liability between the corporate debtor and the operational creditor, as the respondent admitted the debt in its ledger account.

3. Compliance with Section 9(5)(i) of the Insolvency and Bankruptcy Code, 2016:
The tribunal reviewed the provisions of Section 9(5)(i) of the Code, which mandates the adjudicating authority to admit the application if:
- The application is complete.
- There is no payment of the unpaid operational debt.
- The invoice or notice for payment has been delivered.
- No notice of dispute has been received.
- No disciplinary proceeding is pending against any proposed resolution professional.

The tribunal found the application complete and noted that the corporate debtor had not paid the debt, nor was there any record of dispute. Additionally, there were no pending disciplinary proceedings against any resolution professional.

4. Admission of Corporate Insolvency Resolution Process (CIRP) Petition:
Based on the compliance with Section 9(5)(i), the tribunal admitted the petition for initiating the CIRP against the corporate debtor, SPG Global Distribution Pvt. Ltd. The tribunal was satisfied that the corporate debtor had defaulted on its payment obligations, and the operational creditor had proved the debt and default, which exceeded Rs. 1 lakh.

5. Declaration of Moratorium:
The tribunal declared a moratorium under Section 14(1) of the Code, which included:
- Suspension of suits or proceedings against the corporate debtor.
- Prohibition on transferring or disposing of assets.
- Restriction on actions to recover or enforce security interests.
- Prevention of recovery of property occupied by the corporate debtor.

The moratorium would remain effective until the completion of the CIRP or approval of a resolution plan, or an order for liquidation.

6. Appointment of Interim Resolution Professional (IRP):
The tribunal appointed Mr. Divyanshu Mishra as the Interim Resolution Professional (IRP). The IRP's credentials were verified, and no adverse findings were reported. The tribunal directed the IRP to:
- Suspend the powers of the Board of Directors.
- Manage the affairs of the corporate debtor.
- Make a public announcement of the CIRP initiation.
- Cooperate with the corporate debtor’s management.
- Constitute a Committee of Creditors and file a report within thirty days.
- Send regular progress reports to the tribunal.

Conclusion:
The tribunal admitted the CIRP petition, declared a moratorium, and appointed an IRP, ensuring compliance with the Insolvency and Bankruptcy Code, 2016. The tribunal’s decision was based on the undisputed debt and the corporate debtor’s failure to fulfill its payment obligations.

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