Tribunal admits CIRP petition, appoints IRP to manage affairs and ensure compliance with Code

The tribunal admitted the petition for initiating Corporate Insolvency Resolution Process (CIRP) against the corporate debtor, declared a moratorium under Section 14 of the Insolvency and Bankruptcy Code, and appointed Mr. Jugraj Singh Bedi as the Interim Resolution Professional (IRP). The tribunal found that the demand notice was properly served, the operational debt was not disputed, and all statutory requirements were met. The IRP was directed to manage the affairs of the corporate debtor and ensure compliance with the Code and relevant regulations.

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Issues Involved:
1. Whether the demand notice in Form No. 3 dated 21.08.2019 was properly served.
2. Whether the operational debt was disputed by the corporate debtor.
3. Compliance with Section 9(5)(i) of the Insolvency and Bankruptcy Code, 2016.
4. Appointment of Interim Resolution Professional (IRP).
5. Declaration of moratorium under Section 14 of the Code.

Issue-wise Detailed Analysis:

1. Proper Service of Demand Notice:
The tribunal examined if the demand notice dated 21.08.2019 was properly served to the corporate debtor. The notice was sent to the registered office address as per the master data (SCO-43, Old Judicial Complex, Sector-15, Gurgaon, Haryana). The delivery receipt and acknowledged copy of the notice were found attached in the petition, confirming proper service.

2. Dispute of Operational Debt:
The tribunal considered if the operational debt was disputed by the corporate debtor. The corporate debtor neither filed any reply to the petition nor disputed the liability towards the operational creditor. On the last hearing date, the corporate debtor’s counsel admitted the inability to clear the debt, indicating no dispute regarding the liability.

3. Compliance with Section 9(5)(i) of the Code:
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 the proposed IRP.

The tribunal found the application complete, with the total unpaid operational debt amounting to Rs. 8,16,150/- (principal amount of Rs. 5,70,000/- and interest of Rs. 2,46,150/-). The necessary affidavits and documents, including the demand notice and invoices, were properly filed. The corporate debtor failed to make the payment and did not dispute the debt. No disciplinary proceedings were pending against the proposed IRP.

4. Appointment of Interim Resolution Professional (IRP):
The tribunal appointed Mr. Jugraj Singh Bedi as the IRP, confirming his credentials and noting no adverse findings. The tribunal directed the IRP to assume management of the corporate debtor’s affairs, prepare an inventory of assets, and act in accordance with the Code and relevant regulations. The IRP was also instructed to make a public announcement, constitute a Committee of Creditors, and submit regular progress reports.

5. Declaration of Moratorium:
The tribunal declared a moratorium under Section 14 of the Code, effective from the date of the order until the completion of the Corporate Insolvency Resolution Process (CIRP) or further orders. The moratorium included:
- Suspension of suits or proceedings against the corporate debtor.
- Prohibition on transferring or disposing of assets.
- Prevention of actions to foreclose or enforce security interests.
- Continuation of essential goods or services to the corporate debtor.

The tribunal directed the corporate debtor and associated personnel to cooperate with the IRP and ensure the continuity of the corporate debtor’s operations.

Conclusion:
The tribunal admitted the petition for initiating CIRP against the corporate debtor, declared a moratorium, and appointed Mr. Jugraj Singh Bedi as the IRP, directing compliance with the Code and relevant regulations. The tribunal ensured that all statutory requirements were met and that there were no disputes regarding the operational debt.

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