2022 (3) TMI 1261 - Tri - Insolvency and Bankruptcy

Tribunal Admits Company Petition for Insolvency Resolution Process

The Tribunal admitted the Company Petition and ordered the initiation of Corporate Insolvency Resolution Process against the Corporate Debtor, M/s. Apex ... Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- Though in the reply notice, the Corporate Debtor took a stand that the Operational Creditor failed to perform his duties as prescribed under the agreements and that the term of 4 years elapsed as per contract dated 31.12.2011 and was not renewed and that the project did not materialise during the term in question, no evidence in that regard is produced and the Corporate Debtor did not choose to appear and contest the case and prove the contentions made in the reply notice. Whereas, by virtue of the documents filed by the Operational Creditor his case stand proved prima facie. Since his case is non-controverted, it has to be accepted as true. It is a fit case to admit and order initiation of Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor - Company Petition is admitted - moratorium declared. Issues:Initiation of Corporate Insolvency Resolution Process under Section 9 of the Insolvency and Bankruptcy Code, 2016 based on default in payment by the Corporate Debtor.Detailed Analysis:1. Background and Allegations:- The Operational Creditor, a reputed businessman in Real Estate and Construction, filed a petition seeking initiation of Corporate Insolvency Resolution Process against the Corporate Debtor, M/s. Apex Meadows Private Limited.- The Operational Creditor alleged that the Corporate Debtor defaulted on a payment of Rs. 26,80,31,333/-, including interest, arising from revenue shares due under a Revenue Sharing Agreement dated 29.01.2009.2. Terms of Agreements and Default:- The Operational Creditor was appointed as an Executive Director by the Corporate Debtor and entered into agreements regarding revenue share entitlement based on the sale of residential units.- The Revenue Sharing Agreement stipulated payment on a 'per square feet' basis by the 21st of every month, with interest for delays.- Despite completing the tenure and tracking over 200 transactions, the Operational Creditor claimed non-payment of his entitled share, leading to legal notices and unsubstantiated excuses from the Corporate Debtor.3. Legal Proceedings and Non-Controverted Claims:- The Corporate Debtor failed to appear or contest the claims made by the Operational Creditor, leading to a non-controverted case.- The Tribunal found the Operational Creditor's submissions supported by evidence, as opposed to the unsubstantiated claims made by the Corporate Debtor in the reply notice.4. Admission and Resolution Process:- The Tribunal admitted the Company Petition and ordered the initiation of Corporate Insolvency Resolution Process against the Corporate Debtor.- An Insolvency Resolution Professional (IRP) was appointed to oversee the process, with directives to manage the Corporate Debtor's affairs and implement necessary steps under the Insolvency and Bankruptcy Code.- Moratorium was declared, and cooperation from Directors, Promoters, and associated parties with the Corporate Debtor was mandated for the effective resolution process.5. Final Orders and Compliance:- The order for commencement of Corporate Insolvency Resolution Process was communicated to the Operational Creditor, Corporate Debtor, and the appointed IRP for necessary compliance.- The Interim Resolution Professional was directed to take immediate charge of the Corporate Debtor's management and proceed with the resolution process as per the Code and relevant rules.This detailed analysis outlines the legal judgment involving the initiation of Corporate Insolvency Resolution Process based on default in payment by the Corporate Debtor, highlighting the agreements, default claims, legal proceedings, admission of the petition, appointment of IRP, and directives for the resolution process.