2021 (1) TMI 112 - Tri - Insolvency and Bankruptcy

Company Petition Resolved Through Settlement Agreement

The Tribunal disposed of the Company Petition seeking initiation of Corporate Insolvency Resolution Process against the Respondent, as the parties ... Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditor - existence of debt and dispute or not - HELD THAT:- Since the Parties themselves have settled the issue by way of Settlement dated 21.12.2020, we are inclined to dispose of the instant Company Petition by directing the Parties to strictly adhere the terms and conditions of the settlement. The Parties are hereby directed to strictly adhere to the terms and conditions of Settlement dated 21.12.2020, failing which, the Petitioner is at liberty to approach the Adjudicating Authority by way filing fresh Company Petition as per law - Petition disposed off. Issues:Initiation of Corporate Insolvency Resolution Process based on default amounting to Rs. 13,27,922. Settlement reached between the parties out of their own free will.Initiation of Corporate Insolvency Resolution Process:The judgment pertains to a case filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 seeking to initiate the Corporate Insolvency Resolution Process against the Respondent for defaulting on a total amount of Rs. 13,27,922. The case underwent multiple listing dates for admission, with adjournments granted for various reasons such as service of notice and settlement attempts. The learned counsels for both parties presented a Memo of Settlement dated 21.12.2020, wherein the Respondent agreed to pay Rs. 10,00,000 in five monthly installments as a full and final settlement of their dues. Both parties affirmed the settlement was reached voluntarily without any coercion or undue influence.Settlement Between Parties:The settlement terms outlined that the Respondent would pay Rs. 10,00,000 to the Petitioner in five monthly installments of Rs. 2,00,000 each, starting from 25.1.2021. It was agreed that any default in payment would lead to the revival of the Company petition without further steps, enabling the Petitioner to enforce their rights through appropriate legal proceedings. The settlement was deemed as a complete resolution of all disputes between the parties, with no further amounts due once the agreed sum was paid. Both parties committed not to initiate any legal actions citing old disputes upon full payment of the settlement amount. The settlement terms were to be presented to the NCLT, Bengaluru for appropriate orders.Judgment and Disposal:Considering the voluntary settlement reached between the parties, the Tribunal decided to dispose of the Company Petition. The parties were directed to strictly adhere to the terms and conditions of the settlement dated 21.12.2020. It was emphasized that any failure to comply would grant the Petitioner the liberty to file a fresh Company Petition as per the law. No costs were awarded in the judgment, signifying the resolution of the matter without imposing any financial burden on either party.This comprehensive analysis of the judgment highlights the legal proceedings, the settlement agreement, and the final directives provided by the Tribunal, ensuring a detailed understanding of the case's resolution.