TaxTMI 
TaxTMI 
2019 (9) TMI 415
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....orporate Debtor') which having admitted by the Adjudicating Authority (National Company Law Tribunal), Principal Bench, New Delhi on 29th May, 2019, the present appeal has been preferred by the Promoter/ Shareholder. 2. Learned counsel appearing on behalf of the Appellant submitted that the impugned order has been passed in complete disregard to the provisions of Section 7 (5) (a) of the 'I&B Code', as per which the admission of application under Section 7 is not contemplated in all cases where default has occurred. The discretion vests with the Adjudicating Authority to admit or reject the application, even if the default has occurred, keeping in mind the object of the 'I&B Code'. However, such submissions cannot be accepted as it is not....
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.... a person to whom an operational debt is owed and an operational debt under Section 5(21) means a claim in respect of provision of goods or services. 28. When it comes to a financial creditor triggering the process, Section 7 becomes relevant. Under the explanation to Section 7(1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor- it need not be a debt owed to the applicant financial creditor. Under Section 7(2), an application is to be made under sub-section (1) in such form and manner as is prescribed, which takes us to the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Under Rule 4, the application is made by a financial creditor in Form 1 accompanied by do....
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....uthority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be. 29. The scheme of Section 7 stands in contrast with the scheme under Section 8 where an operational creditor is, on the occurrence of a default, to first deliver a demand notice of the unpaid debt to the operational debtor in the manner provided in Section 8(1) of the Code. Under Section 8(2), the corporate debtor can, within a period of 10 days of receipt of the demand notice or copy of the invoice mentioned of a dispute or the record of the pendency of a suit or arbitration proceedings, which is pre-existing- i.e. before such notice or invoice was received by th....