Court affirms insolvency application under Section 7 of I&B Code, dismissing natural justice claims.

The court upheld the order admitting an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 against a corporate debtor, rejecting claims of a violation of Principles of Natural Justice and incompleteness of the application. The appellant's contentions regarding the denial of an opportunity to file a reply were dismissed, as the debtor had ample chances to engage in the process, settle the debt, and comply with the I&B Code. The court emphasized that the debtor had multiple opportunities to address the issues raised, leading to no interference against the impugned order.

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Issues: Violation of Principles of Natural Justice, Completeness of Application under I&B Code, Opportunity to File Reply

Violation of Principles of Natural Justice:
The appeal stemmed from an order admitting an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 against a corporate debtor. The appellant contended that the order violated the Principles of Natural Justice by not allowing them to submit a reply to the company petition. However, the judgment highlighted that the corporate debtor had multiple opportunities to file a reply but chose not to do so. The court noted that the debtor expressed the ability and desire to make payments, and various extensions were granted to facilitate a settlement. The court found that the order was not passed without affording an opportunity for filing a reply, as claimed by the appellant.

Completeness of Application under I&B Code:
The appellant argued that the application under Section 7 of the I&B Code, along with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, was incomplete. Additionally, the appellant raised concerns about the initiation of proceedings by one bank without the consent of other banks party to a common loan agreement. The court examined these contentions but found that the application was complete, and the debtor had sufficient opportunities to address the issues raised.

Opportunity to File Reply:
The appellant further contended that the adjudicating authority did not allow the corporate debtor to file a reply, thus denying them a chance to present their case. The judgment detailed the series of events where the debtor was given multiple chances to settle the matter, with extensions granted for payment in response to settlement offers. Despite these opportunities, the debtor failed to honor the commitments made, leading to the admission of the petition against them. The court emphasized that the debtor had ample opportunities to engage in the process and settle the outstanding debt but failed to do so, leading to the admission of the petition.

In conclusion, the court found no grounds for interference against the impugned order dated 20th August 2019, as the debtor had multiple opportunities to address the issues raised, settle the matter, and comply with the obligations under the I&B Code.

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