Tribunal Admits Application for Insolvency Proceedings, Imposes Moratorium

The Tribunal admitted the Application under Section 9(5) of the Insolvency & Bankruptcy Code, 2016, appointing an Interim Resolution Professional and imposing a moratorium on the Corporate Debtor under Section 14(1). The Operational Creditor substantiated the operational debt and default, leading to the initiation of Corporate Insolvency Resolution Process. The moratorium restricts actions related to the Debtor's assets and legal proceedings, with essential supplies continuing. The duration of the moratorium was specified, and the Operational Creditor was directed to pay expenses to the Interim Resolution Professional.

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Issues:
Application under Section 9 of the Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process (CIRP) against Corporate Debtor.

Detailed Analysis:
1. The Application filed under Section 9 of the IBC, 2016 by the Operational Creditor seeks to initiate the CIRP against the Corporate Debtor, a Private Limited Company. The Operational Creditor has not proposed the name of the Interim Resolution Professional, leaving it to the discretion of the Tribunal.

2. The Operational Creditor was approached by the Corporate Debtor for the supply of computer peripheral materials. Despite some payments being made, payments are pending towards 43 invoices. The Application states a due amount of Rs. 2,01,23,650/- as of 30.04.2021, with the default date being 20.12.2018.

3. Relevant documents supporting the operational debt and default are attached to the Application, including purchase orders, invoices, email correspondence, and the statement of accounts for the year 2017-2018. A Demand Notice was sent to the Corporate Debtor on 31.08.2020, followed by an Affidavit under Section 9(3)(b) of IBC, 2016.

4. Despite multiple notices and publications, the Corporate Debtor did not appear during the proceedings. The Tribunal found that the Operational Creditor substantiated the operational debt and default. The Tribunal noted that the default predated the Covid-19 pandemic, making Section 10A of IBC, 2016 inapplicable.

5. The Tribunal admitted the Application under Section 9(5) of the IBC, 2016, appointing an Interim Resolution Professional. The moratorium under Section 14(1) was imposed on the Corporate Debtor, restricting various actions related to its assets and legal proceedings. Essential supplies to the Corporate Debtor were to continue during the moratorium period.

6. The duration of the moratorium was specified under Section 14(4) of the Code. The Operational Creditor was directed to pay a sum to the Interim Resolution Professional for expenses. The Application's admission triggered the moratorium, and relevant parties were informed accordingly.

This detailed analysis covers the key aspects of the judgment, including the grounds for the Application, the Tribunal's findings, and the consequential orders issued regarding the initiation of CIRP and imposition of the moratorium.

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