Tribunal Admits CIRP Petition, Declares Moratorium for Corporate Debtor

The Tribunal admitted the petition for initiation of Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, declaring a moratorium and appointing an Interim Resolution Professional. The Corporate Debtor acknowledged the debt, leading to the Tribunal's decision to proceed with the resolution process. The petition was found to be within the limitation period, ensuring compliance. The Tribunal emphasized cooperation among parties and outlined guidelines for the Interim Resolution Professional, with the petitioner directed to deposit funds for immediate CIRP expenses, to be reimbursed by the Committee of Creditors.

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Issues Involved:
1. Initiation of Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016.
2. Validity of demand notice and service.
3. Dispute of operational debt by the corporate debtor.
4. Filing of application within the limitation period.

Analysis:

Initiation of CIRP under Section 9:
The petition was filed by the Operational Creditor seeking to initiate CIRP against the Corporate Debtor for an unpaid operational debt. The Corporate Debtor did not dispute the debt, acknowledging the financial inability to pay. The petition provided details of the debt, including the amount and interest claimed, along with supporting documents such as ledger statements and balance sheets. The Tribunal found the petition complete and admitted it for further proceedings.

Validity of Demand Notice and Service:
The Tribunal examined the service of the demand notice issued by the Operational Creditor to the Corporate Debtor. It was established that the demand notice was properly served as per the tracking report, and no reply was received from the Corporate Debtor. Therefore, the demand notice was deemed to have been duly served.

Dispute of Operational Debt:
The Corporate Debtor did not dispute the operational debt claimed by the Operational Creditor. The affidavit submitted by the petitioner and the reply from the Corporate Debtor indicated an admitted liability, with the Corporate Debtor stating its financial unviability and inability to pay the claimed amount. This lack of dispute confirmed the existence of an admitted liability.

Filing within Limitation Period:
The petition was filed within the limitation period, as the demand notice was served on the Corporate Debtor, and no reply or payment was made. The Tribunal noted that the application was filed within the statutory time frame from the date of default, ensuring compliance with the limitation requirement.

Conclusion:
The Tribunal, after considering all aspects of the case, admitted the petition for initiation of CIRP against the Corporate Debtor. A moratorium was declared, and an Interim Resolution Professional was appointed to manage the affairs of the Corporate Debtor during the insolvency resolution process. The Tribunal directed cooperation from all parties involved and set guidelines for the Interim Resolution Professional to follow, ensuring a smooth resolution process. The petitioner was also directed to deposit an amount for immediate expenses related to the CIRP, which would be reimbursed by the Committee of Creditors.

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