TaxTMI 
TaxTMI 
2020 (8) TMI 425
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.... 29th March, 2019 whereby, the CIRP proceedings initiated against the 'Corporate Debtor', namely, S.K. Wheels Private Limited. It is submitted that the Appellant is a leading Global Information Technology Company. Whilst, a facilities agreement dated 1st December, 2016 (Facilities Agreement) was entered into with 'Corporate Debtor' i.e. S.K. Wheels Private Limited, to avail services from the 'Corporate Debtor', in the nature of facilities, namely premises, computers, internet, broadband connection, air conditioners, furniture, staff for invigilation, housekeeping, maintenance, etc. to enable conduct of examinations deploying National Technology Infrastructure for the Appellant's clients. 3. It is submitted that the 'Corporate Debtor' failed to remedy contractual breaches, thereby, a notice of termination dated 10th June, 2019 issued by the Appellant in terms of Clause 11(b) of the Facilities Agreement. 4. It is submitted that the Respondent, herein, the 'Resolution Professional' filed an M.A. No. 2954 of 2019 dated 28th August, 2019, before the Adjudicating Authority (NCLT- Mumbai) seeking inter-alia to stay of the termination notice issued by the Appellant. The Adjudicating Auth....
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....tself states that it allegedly became aware when the electricity was disconnected sometime in April 2019, which was due to non-payment of electricity charges during CIRP and was eventually restored. It is submitted that certain meetings were held in April and May, 2019, whereby, the Interim Resolution Professional intimated the Appellant that no prejudice would be caused to the Appellant and all the services and facilities would be provided as contained in the agreement. The Learned Counsel further submitted that the Appellant issued termination notice as per the Clause 11(b) of the Agreement, however, the same is not in accordance with the said clause. As per the above Clause, a 30 days' notice needs to be given in the event of any material breach by either party. However, no notice was received by the 'Corporate Debtor' except the termination notice dated 11.06.2019. The Learned Counsel submitted that they have filed an application before the Adjudicating Authority seeking directions to the Appellant to continue the Facilities Agreement dated 01.12.2016, and staying of termination of Facilities Agreement dated 01.12.2016 till the expiry of Corporate Insolvency Resolution Process.....
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....ch led to issue and serve termination notice. Prima-facie as sated (Supra) the Learned Counsel for the Respondent submitted that they have cured all the deficiencies and the termination notice after the initiation CIRP (Corporate Insolvency Resolution Process) is against the main object of the Code. 10. Admittedly, the CIRP process was initiated on 29th March, 2019 against the 'Corporate Debtor". The termination notice is subsequent to the admission of the initiation of the CIRP. In this Appeal the limited question is whether the order passed by the Adjudicating Authority staying the termination notice is legal or not. Therefore, we are confined to the limited question whether the order passed by the Adjudicating Authority staying the termination notice is legal or not. Before deciding the said issue, we have to look into the legal position. In the present case admittedly, moratorium was imposed as per Section 14(1) of the I&B Code 2016. Sub Section (1) reads thus:- .... "14(1):- Subject to provisions of sub-sections (2) and (3) on the insolvency commencement date, the Adjudicating Authority shall by order declare moratorium for prohibiting all of the following, namely:- (....
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....by an owner or lessor where such property is occupied by or in the possession of the Corporate Debtor. (II) That the supply of essential goods or services to the Corporate Debtor, if continuing, shall not be terminated or suspended or interrupted during moratorium period. (III) That the provisions of sub-section (1) of Section 14 shall not apply to such transactions as may be notified by the Central Government in consultation with any financial section regulator. (IV) That the order of moratorium shall have effect from 29.03.2019 till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidation of Corporate Debtor under section 33, as the case may be. (V) That the public announcement of the corporate insolvency resolution process shall be made immediately as specified under section 13 of the Code. (VI) That this Bench hereby appoints Mr. Vishal Ghisulal Jain, B03/7/1-2, Section- 15, Vashi, Navi Mumbai- 400703, Email:- [email protected], having Registration No. IBBI/IPA-001/IPP00419/ 2017-18/1072 as Interim Resolution Professional to carry the....