Tribunal Admits Company Petition for CIRP, Appoints IRP, Imposes Moratorium

The Tribunal admitted the Company Petition, ordering the initiation of Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor. An Interim Resolution Professional was appointed, and initial CIRP costs were specified. The Tribunal imposed restrictions on legal actions against the Corporate Debtor, ensuring continuity of essential services during the moratorium period. Management vested in the IRP/RP during CIRP, with necessary notifications directed to relevant authorities. The Tribunal rejected the Corporate Debtor's limitation plea and defense of pre-existing disputes, finding them unsubstantiated. The Registry was instructed to promptly communicate the order to all parties.

---

---

Issues: Initiation of Corporate Insolvency Resolution Process (CIRP) under Section 8 & 9 of Insolvency and Bankruptcy Code, 2016; Plea of Limitation; Pre-existence of Disputes.

Initiation of CIRP: The Company petition sought to initiate CIRP against the Corporate Debtor for non-payment of a substantial amount along with interest. The history of the petition involved previous litigations before the Hon'ble Bombay High Court and subsequent transfer to the NCLT post-enforcement of the Insolvency and Bankruptcy Code, 2016.

Plea of Limitation: The Corporate Debtor contested the petition on grounds of limitation, citing the origin of the claim in 2011-2012. However, evidence showed a meeting in 2012 where outstanding dues were acknowledged, and an email in 2015 reaffirmed the debt. The Tribunal excluded time spent on previous litigations and dismissed the limitation plea based on the acknowledgment of debt and legal precedents.

Pre-existence of Disputes: The Corporate Debtor raised the issue of pre-existing disputes, but the Tribunal noted the legal notice issued by the Operational Creditor in 2015 remained unanswered. The Corporate Debtor's acknowledgment of liability through meeting minutes and emails negated the dispute claim. The Tribunal found the defense of pre-existing disputes unsubstantiated and rejected it.

Judgment: The Tribunal admitted the Company Petition, ordering the initiation of CIRP against the Corporate Debtor. An Interim Resolution Professional was appointed, and initial CIRP costs were specified. The Tribunal imposed restrictions on legal actions against the Corporate Debtor, ensuring continuity of essential services during the moratorium period. The management vested in the IRP/RP during CIRP, and necessary notifications were directed to relevant authorities. The Tribunal concluded by instructing the Registry to communicate the order to all parties promptly.

---