TaxTMI 
TaxTMI 
2019 (7) TMI 1720
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....84) against whom initiation of Corporate Insolvency Resolution Process has been prayed for, was incorporated on 05.10.1987 having its registered office situated at 401, MahvirJi Complex, LSC, Rishabh Vihar, New Delhi - 110092. Since the registered office of the respondent corporate debtor is in New Delhi, this Tribunal having territorial jurisdiction over the NCT of Delhi is the Adjudicating Authority in relation to the prayer for initiation of Corporate Insolvency Resolution Process in respect of respondent corporate debtor under sub-section (1) of Section 60 of the Code. 3. It is appropriate to mention that the applicant Central Bank of India is a body corporate incorporated under the Banking Companies (Acquisition and Transfer of Undertakings) Act 1970 and has its Registered Office at Chander Mukhi, Nariman Point, Mumbai-400021. 4. Shri Rakesh Sharma, Assistant General Manager and authorized representative of the applicant bank, has preferred the present application on behalf of the applicant for initiation of corporate insolvency resolution process against the respondent corporate debtor in terms of the provisions of the Code. 5. It is the case of the applicant that th....
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.... debts. 12. Subsequently a Scheme of Demerger was presented by M/s. Abhinav Steels and Power Ltd., M/s. RS Ingot and Billet Pvt. Ltd. and M/s. Siddhartha Rolling and Energy Pvt. Ltd. before the National Company Law Tribunal, New Delhi, by which it was proposed to transfer 'Furnace and Rolling Division I' of M/s. Abhinav Steels and Power Ltd. to M/s. RS Ingot and Billet Pvt. Ltd. and 'Rolling Division 2' of M/s. Abhinav Steels and Power Ltd. to M/s. Siddhartha Rolling and Energy Private Limited. It was also proposed that the 'Power Division' of M/s. Abhinav Steel and Power Limited will continue to remain with it, who shall be liable only for its Power Division. 13. The National Company Law Tribunal, New Delhi approved the said Scheme vide order dated 27.11.2017, pursuant to which all the assets and liabilities pertaining to 'Furnace and Rolling Division 1' and 'Rolling Division 2' of M/s. Abhinav Steel and Power Limited were transferred to the resulting companies respectively and only the 'Power Division' of M/s. Abhinav Steel and Power Limited continued to remain with the respondent corporate debtor. The 'Power Division'....
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....ake any payment to the Applicant financial creditor. 19. On the ground that huge amounts are outstanding and as corporate debtor has committed default in repayment of the debt, it is prayed for initiation of corporate insolvency resolution process against the respondent company by admitting the present application. 20. The respondent corporate debtor has filed its reply on 09.01.2019. Respondent has disputed the demand of Rs. 103,70,35,611/- and interest thereon as unreasonable and not due and payable. It has been alleged that the demand is erroneous and arbitrary. The claim has also been disputed as barred by limitation. Another objection has been raised that the petition has not been filed in the prescribed Format as brief facts cannot be given under Part V of the requisite Form-1. It is further alleged that the Form-2 submitted by the named IRP lacks proper disclosures as required under the Regulations and that he is not eligible for appointment of IRP. An objection has also been raised that there is no proof of default and there is no statement of account in the name of 'Power Division'. It is also the case of the respondent that the applicant is not a financial c....
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....ief facts of the case at Part-V of Form-1 inter alia to throw light on the Scheme of Demerger and to explain that the present claim pertains only towards the loan facility given for power Division of the corporate debtor. Additional relevant facts have been incorporated at Part-V of the application Form for proper appreciation of the matter. Such insignificant technical objections are only to be iron out and cannot be a ground to reject the application filed under Section 7 of the Code. 29. In connection with the objection that the application is incomplete and the financial creditor has failed to comply with the requirements of Section 7 of the Code; it is seen that the present application under Section 7 of the Code for initiation of Corporate Resolution Insolvency Process has been filed by petitioner financial creditor in Form-1 in terms of Rule 4 of Insolvency and Bankruptcy (application to Adjudicating Authority) Rules, 2016 accompanied with required information, documents and records as prescribed under the Rules. 30. The applicant bank inert-alia has annexed to the application detail particulars of 'financial debt' including documents, records and evidence of d....
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.... Company Appeal (AT) (Insolvency) No. 136 of 2018 vide order dated 21.5.2018 at para 4 has made this aspect clear with the following observation: 4. Further, in a petition under Section 7 of the 'I&B Code', the Adjudicating Authority is required to decide whether the Form 1 along with documents is complete or not. The Adjudicating Authority is not required to decide as to what is the actual amount of claim and other details, which is required to be determined by the 'Resolution Professional' after initiation of 'Corporate Insolvency Resolution Process'. 35. The debt has also been challenged on the ground of limitation. In this regard there is no dispute that the loan account was restructured on 10.06.2013 and was secured by way of mortgage. Under Article 62 of the Limitation Act, when mortgage is created over immovable property and offered as collateral security for the loan, the limitation period is 12 years. Even otherwise it is seen that the Scheme of Demerger was approved on 27.11.2017 inter alia fixing the liability of respondent pertaining to Power Project'. It creates fresh period of limitation from 27.11.2017. In view of the continuou....
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....maintainable. 43. It is pertinent to mention here that the Code requires the adjudicating authority to only ascertain and record satisfaction in a summary adjudication as to the occurrence of default before admitting the application. The material on record clearly goes to show that respondent has committed default in repayment of the outstanding loan amount. 44. In the facts it is seen that the applicant bank clearly comes within the definition of Financial Creditor. The material placed on record further confirms that applicant financial creditor had disbursed various loan facilities to the respondent corporate debtor and the respondent has availed the loan and committed default in repayment of the relevant outstanding financial debt. On a bare perusal of Form - I filed under Section 7 of the Code read with Rule 4 of the Rules shows that the form is complete and there is no infirmity in the same. It is also seen that there is no disciplinary proceeding pending against the proposed IRP. We are satisfied that the present application is complete in all respect and there has been default in payment of the financial debt. 45. As a sequel to the above discussion and in terms of ....
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....ions of moratorium shall not apply to transactions which might be notified by the Central Government or the supply of the essential goods or services to the Corporate Debtor as may be specified, are not to be terminated or suspended or interrupted during the moratorium period. In addition, as per the Insolvency and Bankruptcy Code (Amendment) Act, 2018 which has come into force w.e.f. 06.06.2018, the provisions of moratorium shall not apply to the surety in a contract of guarantee to the corporate debtor in terms of Section 14 (3) (b) of the Code. 51. The Interim Resolution Professional shall perform all his functions contemplated, inter-alia, by Sections 15, 17, 18, 19, 20 & 21 of the Code and transact proceedings with utmost dedication, honesty and strictly in accordance with the provisions of the Code, Rules and Regulations. It is further made clear that all the personnel connected with the Corporate Debtor, its promoters or any other person associated with the Management of the Corporate Debtor are under legal obligation under Section 19 of the Code to extend every assistance and cooperation to the Interim Resolution Professional as may be required by him in managing the day....