Tribunal asserts jurisdiction in loan default case, admits petition under IBC for insolvency resolution process.

The Tribunal confirmed jurisdiction over the case involving a loan agreement where the Corporate Debtor defaulted on repayment. Electronic evidence was deemed admissible without a Section 65B certificate. The loan was classified as a financial debt, leading to the appointment of an Interim Resolution Professional. A moratorium was ordered under Section 14 of the IBC, with directions for compliance and ongoing management by the IRP. The petition was admitted, initiating the Corporate Insolvency Resolution Process with immediate effect.

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Issues Involved:
1. Jurisdiction of the Tribunal.
2. Existence and validity of the loan agreement.
3. Default in repayment of the loan.
4. Admissibility of electronic evidence.
5. Classification of the loan as a financial debt.
6. Appointment of the Interim Resolution Professional (IRP).
7. Directions for moratorium and compliance.

Detailed Analysis:

1. Jurisdiction of the Tribunal:
The Tribunal confirmed its jurisdiction over the case as the Corporate Debtor, incorporated on 13.03.2008, has its registered address in Ludhiana, falling under the purview of the Chandigarh Bench of the National Company Law Tribunal (NCLT).

2. Existence and Validity of the Loan Agreement:
The Corporate Debtor approached the Petitioner for a friendly loan of Rs. 15,00,000/- for three months at an interest rate of 12% p.a. The loan was paid on 07.09.2018 through NEFT and renewed quarterly up to 08.03.2019. Despite the loan becoming due on 08.03.2019, the Corporate Debtor failed to repay the principal amount and interest. The Corporate Debtor issued a cheque on 20.04.2019, which was returned unpaid due to insufficient funds. The Corporate Debtor acknowledged the loan in its reply to the demand notice dated 13.05.2019.

3. Default in Repayment of the Loan:
The Tribunal noted that the default occurred on 09.03.2019, and the petition was filed on 22.05.2019, within the limitation period. The default was evidenced by the copies of Income Tax Form AS-26, indicating interest payments after TDS deductions, and the NEFT transfer of Rs. 15,00,000/- to the Corporate Debtor's account.

4. Admissibility of Electronic Evidence:
The Corporate Debtor argued that electronic evidence without a certificate under Section 65B of the Indian Evidence Act is inadmissible. However, the Tribunal referred to the Supreme Court's judgment in Arjun Panditrao Khotkar Vs. Kailash Kushanrao Gorantyal, stating that primary electronic evidence does not require a Section 65B certificate. The Tribunal found the default amount admitted and reflected in the Corporate Debtor's reply and written submissions, making the argument about Section 65B misplaced.

5. Classification of the Loan as a Financial Debt:
The Tribunal referred to the NCLAT judgment in Narender Kumar Agarwal vs. Monotrone Leasing Private Limited, which held that inter-corporate deposits with interest qualify as financial debt under Section 5(8) of the IBC. The Tribunal found that the loan amount advanced by the Petitioner falls under the definition of financial debt, as it was disbursed against the consideration for the time value of money.

6. Appointment of the Interim Resolution Professional (IRP):
The Tribunal appointed Mr. Akshay Mehra as the Interim Resolution Professional (IRP) after verifying his credentials. The IRP was directed to take over the management of the Corporate Debtor, prepare an inventory of assets, and make a public announcement of the Corporate Insolvency Resolution Process (CIRP).

7. Directions for Moratorium and Compliance:
The Tribunal ordered a moratorium under Section 14 of the IBC, prohibiting suits, asset transfers, security interest enforcement, and property recovery against the Corporate Debtor. Essential goods and services to the Corporate Debtor were to continue uninterrupted. The IRP was instructed to act in accordance with the IBC, make a public announcement, and file regular progress reports. The Financial Creditor was directed to deposit Rs. 70,000/- with the IRP for expenses.

Conclusion:
The petition was admitted, and the Tribunal directed the initiation of the CIRP against the Corporate Debtor. The moratorium took effect immediately, and the IRP was instructed to manage the Corporate Debtor's affairs and report progress to the Tribunal.

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