Corporate Debtor Liability Found, Insolvency Process Initiated with Moratorium and Interim Professional Appointment

The Tribunal found the liability of the corporate debtor to be undisputed, admitted the petition for initiation of the Corporate Insolvency Resolution Process, declared a moratorium, appointed an Interim Resolution Professional, and issued specific directions regarding the management of the affairs of the Corporate Debtor during the process. The petitioner was directed to deposit a certain amount with the Interim Resolution Professional for immediate expenses related to the Corporate Insolvency Resolution Process. The Tribunal ensured communication of the order to both parties and directed the petitioner to provide a copy to the Interim Resolution Professional promptly.

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Issues involved:
1. Proper service of demand notice
2. Disputed operational debt by the corporate debtor
3. Filing of application within limitation

Analysis:

1. Proper service of demand notice:
The Tribunal noted that a demand notice in Form 3 dated 29.07.2019 was issued to the operational creditor, but the service was not received. Despite publication in newspapers, the corporate debtor did not appear, leading to being set ex parte. The Tribunal considered this issue and proceeded with the case.

2. Disputed operational debt by the corporate debtor:
The corporate debtor failed to appear despite repeated service attempts, resulting in being set ex parte. The Tribunal found that the operational debt was not disputed by the corporate debtor, as evidenced by their absence during the proceedings.

3. Filing of application within limitation:
The application under Section 9 of the Insolvency and Bankruptcy Code was filed on 15.11.2019, well within the limitation period. The Adjudicating Authority confirmed that the application was filed within the prescribed time frame, meeting the requirements of the Code.

Furthermore, the Tribunal reviewed the complete application filed in Form 5, which detailed the unpaid operational debt and default amount. The petitioner provided evidence of supplying goods to the corporate debtor and raised invoices, establishing the debt. The Tribunal found the liability of the corporate debtor to be undisputed and admitted the petition for initiation of the Corporate Insolvency Resolution Process. The Tribunal declared a moratorium, appointed an Interim Resolution Professional, and issued specific directions regarding the management of the affairs of the Corporate Debtor during the process. The petitioner was directed to deposit a certain amount with the Interim Resolution Professional for immediate expenses related to the Corporate Insolvency Resolution Process. The Tribunal ensured communication of the order to both parties and directed the petitioner to provide a copy to the Interim Resolution Professional promptly.

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