Corporate Debtor Faces Insolvency as Tribunal Confirms Debt Default; Initiates CIRP & Appoints IRP with Moratorium Imposed.

The NCLT admitted the application under Section 9 of the IBC, 2016, initiating the CIRP against the Corporate Debtor. The Tribunal confirmed the existence of an operational debt and default, dismissing claims of a pre-existing dispute. The IRP was appointed, and a moratorium was imposed under Section 14(1) of the Code. The Operational Creditor was directed to deposit Rs. 2 lacs with the IRP for expenses. The registry was instructed to communicate the order and update the status of the Corporate Debtor.

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Issues Involved:
1. Initiation of Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016.
2. Existence of Operational Debt and Default by the Corporate Debtor.
3. Pre-existing Dispute between the Parties.
4. Limitation Period for Filing the Application.
5. Appointment of Interim Resolution Professional (IRP).

Issue-wise Detailed Analysis:

1. Initiation of Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016:
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 M/s. Adecco India Pvt. Ltd. (Applicant), seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. BSES Rajdhani Power Limited (Respondent).

2. Existence of Operational Debt and Default by the Corporate Debtor:
The Operational Creditor (Applicant) provided services to the Corporate Debtor (Respondent) under a Principal Agreement dated 04.07.2017, which was amended on 05.09.2017. The Applicant raised invoices for services rendered, which remained unpaid despite several reminders. The total outstanding debt was Rs. 2,68,06,255/- along with interest. The Respondent made a part payment of Rs. 1,00,00,000/- on 17.11.2018, confirming the undisputed nature of the operational debt.

3. Pre-existing Dispute between the Parties:
The Respondent claimed that there was a pre-existing dispute regarding TDS for FY 2012-13 and double payment of bonus for FY 2017-18. The Tribunal noted that the Respondent had raised disputes related to the amounts claimed before the issuance of the demand notice. However, the Tribunal found that these disputes did not constitute a genuine pre-existing dispute as per the standards set by the Hon’ble Supreme Court in Mobilox Innovations Pvt. Ltd. vs. Kirusa Software Pvt. Ltd. The Tribunal observed that the disputes raised were not supported by substantial evidence and did not survive the scrutiny required to dismiss the application.

4. Limitation Period for Filing the Application:
The last payment by the Corporate Debtor was made on 17.11.2018. The application was filed within the limitation period, and the claim was not time-barred.

5. Appointment of Interim Resolution Professional (IRP):
The Tribunal admitted the application, finding it complete and establishing the default in payment of the operational debt. Mr. Manoj Kumar Anand was proposed and appointed as the Interim Resolution Professional (IRP). The Tribunal directed the IRP to take necessary steps as per Sections 15, 17, 18, 20, and 21 of the Code. Additionally, a moratorium was imposed as per Section 14(1) of the Code, prohibiting certain actions against the Corporate Debtor during the moratorium period.

Conclusion:
The Tribunal admitted the application under Section 9 of the IBC, 2016, initiating the CIRP against the Corporate Debtor. The Tribunal found that the Applicant had established the default in payment of the operational debt beyond doubt, and the requirements under Section 9(5) of the Code were fulfilled. The Tribunal also directed the Operational Creditor to deposit a sum of Rs. 2 lacs with the IRP to meet the expenses for performing his functions. The registry was instructed to communicate the order to relevant parties and update the status of the Corporate Debtor.

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