Corporate Insolvency Resolution Process initiated for M/s. AGM Auto Private Limited with moratorium period

The petition was admitted, and the Corporate Insolvency Resolution Process (CIRP) was initiated against the corporate debtor, M/s. AGM Auto Private Limited, with a moratorium period taking effect immediately. The Tribunal found that all statutory requirements were met, and appointed an Interim Resolution Professional (IRP) to take control of the debtor's assets. The petitioner was directed to deposit funds for CIRP expenses, and the IRP was instructed to manage the affairs of the debtor with cooperation from its directors and personnel. Additionally, the IRP was tasked with public announcements, forming a Committee of Creditors, and submitting progress reports to the Tribunal regularly.

---

---

Issues Involved:
1. Proper service of the demand notice.
2. Dispute over the operational debt.
3. Filing of the application within the limitation period.
4. Compliance with Section 9 of the Insolvency and Bankruptcy Code, 2016.

Issue-wise
Detailed Analysis:

1. Proper Service of the Demand Notice:
The first issue for consideration was whether the demand notice in Form 3 dated 01.02.2020 was properly served. The petitioner provided evidence of the demand notice being sent via email and registered post, which was delivered to the corporate debtor. Therefore, the Tribunal found that the demand notice was duly served.

2. Dispute Over the Operational Debt:
The next issue was whether the operational debt was disputed by the corporate debtor. The Tribunal noted that the corporate debtor did not dispute the claim amount. Instead, it was admitted that the amount was not paid due to a financial crunch in the business. Thus, there was no pre-existing dispute regarding the operational debt.

3. Filing of the Application Within the Limitation Period:
The Tribunal then considered whether the application was filed within the limitation period. The application was filed on 06.10.2022, while the date of default was 30.01.2020. Therefore, the Tribunal found that the application was filed within the limitation period.

4. Compliance with Section 9 of the Insolvency and Bankruptcy Code, 2016:
The Tribunal examined the contents of the application filed in Form 5 and found it to be complete. The unpaid operational debt was Rs. 1,67,27,124/-, which was more than the threshold limit of Rupees one lakh (prior to the amendment in the threshold limit to one crore). The Tribunal noted that the corporate debtor failed to make payment of the amount due as mentioned in the statutory notice. Thus, the conditions under Section 9 of the Code were satisfied. The Tribunal admitted the petition for initiation of the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor and directed a moratorium as per Section 14 of the Code.

Additional Directives:
- The Tribunal appointed Mr. Anil Kumar Singhal as the Interim Resolution Professional (IRP) and directed him to take control and custody of the corporate debtor's assets.
- The Tribunal directed the petitioner to deposit Rs. 60,000 with the IRP to meet immediate expenses of the CIRP.
- The Tribunal ordered that the corporate debtor, its directors, and associated personnel must cooperate with the IRP in managing the affairs of the corporate debtor.
- The IRP was instructed to make a public announcement of the initiation of the CIRP and to constitute a Committee of Creditors (CoC) after collation of all claims.
- The IRP was also directed to send a regular progress report to the Tribunal every fortnight.

Conclusion:
The petition was admitted, and the CIRP was initiated against the corporate debtor, M/s. AGM Auto Private Limited, with a moratorium period taking effect immediately. The Tribunal ensured that all statutory requirements were met and provided clear directives for the continuation of the insolvency process.

---