2021 (5) TMI 391 - Tri - Insolvency and Bankruptcy

Tribunal Admits Insolvency Application, Appoints Professional, Imposes Moratorium

The Tribunal admitted the application under section 9 of the Insolvency and Bankruptcy Code, 2016, filed by the Applicant against the Corporate Debtor for ... Maintainability of application - initiation of CIRP - Corporate Debtor faield to make repayment of its dues - Operational Creditors or not - existence of debt and dispute or not - service of notice - time Limitation - HELD THAT:- In the present case, since the section 8 notice was duly delivered through speed post at the same address with the report item delivered and thereafter the service of section 9 is returned with a remark ‘Addressee left without instructions.’ Hence it can be inferred that the service of section 9 is complete. Moreover, the email service is complete. As per Form V, Part IV, the Corporate Debtor is liable to pay an outstanding sum of ₹ 7,82,142/- along with further interest @18% per annum with effect from 10.08.2016 of which the default has occurred on 10.08.2016 - Applicant has filed an affidavit under section 9(3)(b) dated 11.01.2019 affirming that no notice of dispute has been given by the Corporate debtor relating to dispute of the unpaid operational debt - The registered office of corporate debtor is situated in Delhi and therefore this Tribunal has jurisdiction to entertain and try this application. The date of default as per Form V occurred on 10.08.2016, and the present application was filed on 01.02.2019, hence the debt is not time barred and the application is filed within the period of limitation - the present application is complete and the Applicant is entitled to claim its dues, which remain uncontroverted by the Corporate Debtor, establishing the default in payment of the operational debt beyond doubt. The application is admitted - moratorium declared. Issues:- Application filed under section 9 of Insolvency and Bankruptcy Code, 2016- Non-payment of outstanding dues by the Corporate Debtor- Service of notice and application to the Corporate Debtor- Appointment of Interim Resolution Professional- Deposit of funds by Operational Creditors- Moratorium under Section 14(1) of the CodeAnalysis:1. The application was filed under section 9 of the Insolvency and Bankruptcy Code, 2016, by the Applicant, seeking to initiate the Corporate Insolvency process against the Corporate Debtor due to non-payment of outstanding dues amounting to Rs. 7,82,142. The Applicant had duly served notices and demand letters to the Corporate Debtor, which remained unanswered, leading to the initiation of the insolvency proceedings.2. The Applicant, a private limited company, and the Corporate Debtor, involved in manufacturing and trading, had a business transaction where the Corporate Debtor failed to make payments for packaging materials supplied by the Applicant. Despite several reminders and dishonored cheques, the Corporate Debtor did not settle the outstanding amount, prompting the Applicant to file the insolvency application.3. The service of notice and application to the Corporate Debtor was meticulously carried out by the Applicant through speed post and email, ensuring compliance with the legal requirements. The Tribunal noted that the service was completed as per the provisions of the law, even though the Corporate Debtor did not respond or dispute the claims made by the Applicant.4. The Tribunal, after thorough examination of the facts and circumstances, found the application to be complete and the Applicant entitled to claim its dues. The lack of response from the Corporate Debtor further solidified the default in payment, leading to the admission of the application under section 9(5) of the IBC, 2016.5. An Interim Resolution Professional (IRP) was appointed by the Tribunal to oversee the Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor. The appointed IRP was required to make necessary disclosures and comply with the regulations within a specified timeframe, ensuring transparency and adherence to the insolvency proceedings.6. The Operational Creditors were directed to deposit a sum of Rs. 2 lakhs with the IRP to cover the expenses related to the resolution process. This deposit was subject to adjustment by the Committee of Creditors and was to be refunded to the Operational Creditor as per the proceedings of the CIRP.7. With the admission of the application under section 9(5) of the IBC, 2016, a moratorium was imposed on the Corporate Debtor as per Section 14(1) of the Code. The moratorium prohibited certain actions against the Corporate Debtor, ensuring a structured resolution process during the insolvency proceedings.8. The Tribunal issued directions for communication of the order to the parties involved, including the Applicant, Corporate Debtor, and the appointed IRP. Additionally, compliance reports were to be submitted to the Registrar, NCLT, and the ROC for updating the Master Data, ensuring transparency and regulatory compliance in the insolvency resolution process.